The Indian rupee snapped a two-day losing streak and rose 7 paise to settle at 85.80 against the US dollar on Thursday June 5 2025, buoyed by a fall in global crude oil prices, positive domestic equities, and strength in other Asian currencies.

Forex traders noted that overnight softening in oil prices was a key driver behind the rupee’s recovery. However, the uptrend was capped by a firm US dollar index, as investors awaited the outcome of the RBI monetary policy review.

At the interbank foreign exchange market, the rupee opened at 85.86 and traded between a day high of 85.67 and a low of 85.96, before finally settling at 85.80, gaining 7 paise over the previous close.

Rupee finds support from equities and oil softness

On Wednesday June 4, the rupee had depreciated by 26 paise to close at 85.87, marking its second straight session of decline amid global dollar strength and rising geopolitical tensions.

The domestic currency’s rebound came as Brent crude futures edged up by just 0.31 percent to 65.05 dollars per barrel, after sharp declines in the previous session helped ease inflationary and import-related concerns.

Equity markets also contributed to the rupee’s resilience, with the 30-share BSE Sensex climbing 443.79 points or 0.55 percent to 81442.04, while the Nifty50 gained 130.70 points or 0.53 percent to 24750.90.

Meanwhile, foreign institutional investors FIIs remained net buyers, pumping in 1076.18 crore rupees on Wednesday as per provisional exchange data.

Traders await RBI monetary policy outcome

Investor sentiment remains cautious ahead of the Reserve Bank of India RBI policy announcement scheduled for June 6. The Monetary Policy Committee MPC began its three-day deliberation on Wednesday June 4, with markets speculating on a possible 25 basis points rate cut, though no consensus has emerged yet.

According to Anuj Choudhary Research Analyst at Mirae Asset Sharekhan, the rupee may continue to trade with a negative bias in the short term due to a firm US dollar, elevated crude prices, and ongoing global tensions.

He noted that trade frictions between the US and China and geo-political unrest involving Russia and Ukraine could continue to pressure the Indian currency. However, fresh foreign inflows and positive domestic sentiment may offer support at lower levels.

Choudhary said traders would closely watch weekly US unemployment claims data and the US trade balance report, along with the non-farm payrolls data later this week for further direction in currency markets.

Outlook for USDINR and dollar index

The US dollar index, which tracks the greenback against six major global currencies, was up by 0.06 percent at 98.85, reflecting firm global demand and safe-haven buying amid market uncertainties.

Analysts expect the USDINR spot rate to trade in a broad range of 85.40 to 86.25 in the coming sessions, as markets balance RBI cues with international data trends.

Despite Thursday’s minor appreciation, the rupee remains under pressure in the medium term, and policy outcomes from both domestic and global central banks will be crucial in shaping its trajectory.

The Upcoming IPOs in this week and coming weeks are Jainik Power Cables, Sacheerome Limited, Victory Electric Vehicles International, Wagons Learning.

The Current active IPO are Ganga Bath Fittings.

The Closed IPOs are 3B Films.