USD/INR SOFTENS ON STEADY FII INFLOWS, POSITIVE US-INDIA TRADE TALKS
USD/INR SOFTENS ON STEADY FII INFLOWS, POSITIVE US-INDIA TRADE TALKS
The Indian Rupee (INR) strengthened on Tuesday, April 29, 2025, extending gains from the previous session.
The positive momentum was driven by sustained foreign portfolio investments (FPI) and optimistic developments in US-India trade relations.
Foreign portfolio investors continued to inject capital into Indian equities, with over $2 billion in stock purchases last week.
This consistent inflow bolstered investor confidence and provided support to the INR.
Recent signals from U.S. officials, including Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, indicated progress in trade negotiations between the U.S. and India.
These developments contributed to a positive sentiment in the markets.
The INR closed at 85.26 per U.S. dollar on April 28, 2025, up from 85.45 in the previous session.
This modest appreciation was supported by mild dollar sales from foreign banks.
Despite the rupee's appreciation, near-tenor implied volatility climbed to a two-year high of 5.2%, reflecting heightened market uncertainty amid global geopolitical tensions.
Market participants are closely monitoring upcoming U.S. economic data, including personal consumption expenditure inflation and non-farm payrolls figures, as these could further influence market volatility and currency movements.
