Mumbai, April 2 – The Indian rupee registered a significant surge on Thursday, posting one of its largest single-day gains in many years, closing at 93.14 (provisional) against the US dollar. The rally, totaling 156 paise, marks a notable reversal after a period of depreciation driven by foreign capital outflows and rising crude oil prices.
Currency Fluctuations and RBI Measures
Despite the positive movement, the rupee remained under pressure due to continued foreign capital withdrawal, a strengthening US dollar, and escalating geopolitical tensions impacting crude oil prices. The local currency breached the 95-level on Monday, ultimately closing at 94.70 against the dollar on Friday, prompting the Reserve Bank of India (RBI) to intervene with a series of regulatory measures.RBI’s Intervention
The RBI implemented several directives aimed at restricting banks from trading in the onshore forward markets. A circular issued on March 27, 2026, capped the net open position on the Indian rupee for banks at USD 100 million, with compliance mandated by April 10. Following a review of market conditions, the RBI announced further measures on Wednesday, prohibiting banks from offering non-deliverable derivative contracts involving the rupee to residents and non-residents, and restricting the rebooking of cancelled foreign exchange derivative contracts.Recent Performance and Outlook
Since the onset of the West Asia war on February 28, 2026, the rupee has declined by over 4 per cent, and nearly 10 per cent against the US dollar for the fiscal year ending March 2026. Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, attributed the significant gain to regulatory curbs imposed by the RBI, leading to dollar selling by banks to meet compliance requirements. He anticipates a positive bias for the rupee as banks continue to liquidate open positions ahead of the April 10 deadline, projecting a USD-INR spot price range of Rs 92.20 to Rs 93.20. However, he cautioned that global risk-off sentiments and rising crude oil prices could continue to exert pressure on the currency.Market Context
The dollar index was up 0.60 per cent at 100.05, while Brent crude, the global oil benchmark, rose 6.84 per cent to USD 108.08 per barrel in futures trade. On the domestic equity market, the Sensex closed higher by 185.23 points, or 1.80 per cent, at 73,319.55, and the Nifty rose 33.70 points, or 0.15 per cent, to 22,713.10. Foreign institutional investors sold equities worth Rs 8,331.15 crore on Wednesday. Government GST revenues reached over Rs 2 lakh crore in March, the third highest monthly collection for the 2025-26 fiscal year, driven by increased imports and domestic sales.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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