Rupee Gains on Stock Recovery and Dollar Selling
The Indian rupee appreciated by 7 paise to settle at 95.41 against the US dollar on Thursday, July 9, 2026, driven by a recovery in domestic equity markets and dollar selling by state-run banks. The local currency opened at 95.47 and traded in a narrow range before closing stronger.
Factors Behind the Rise
According to forex traders, the rupee's gain was supported by a rebound in stock markets after recent declines. State-run lenders were seen selling dollars, which also provided support. However, the upside was limited due to rising volatility from the escalating crisis in West Asia, which has kept investors cautious.
"The rupee moved in a tight range with support from equity inflows and dollar sales by public sector banks," said a forex dealer. "But the West Asia situation is creating uncertainty, capping gains."
Impact of Global and Domestic Factors
The dollar index, which measures the greenback against a basket of six major currencies, was down 0.1% at 104.50, offering some relief to emerging market currencies. Meanwhile, Brent crude oil prices eased from recent highs but remained elevated above $85 per barrel due to supply concerns from the Middle East.
On the domestic front, the benchmark Sensex rose 250 points to 62,800, while the Nifty gained 70 points to 18,650, reflecting improved investor sentiment. The recovery in stocks helped the rupee pare some of its recent losses.
Outlook and Market Sentiment
Analysts expect the rupee to remain under pressure in the near term due to global headwinds, including the West Asia conflict and potential rate hikes by the US Federal Reserve. The Reserve Bank of India is likely to intervene through state-run banks to prevent sharp depreciation, as seen in recent sessions.
The rupee has declined over 1% so far in July, touching a record low of 95.70 earlier this week. The currency has been under pressure from sustained foreign fund outflows and a strong dollar.
