The Indian rupee appreciated by 5 paise to settle at 90.69 against the US dollar on Tuesday, February 17, 2026, supported by gains in domestic equity markets and softer crude oil prices in the global market. However, sustained foreign institutional investor outflows and a firm American currency capped further gains, according to forex traders.

The local currency opened at 90.72 in the interbank foreign exchange market and moved within a narrow range throughout the trading session. It touched an intraday high of 90.64 and a low of 90.78 before closing at 90.69 on a provisional basis. On the previous trading day, the rupee had ended 8 paise lower at 90.74 against the US dollar.

The modest recovery reflects a balance between supportive domestic factors and persistent global headwinds.

Opening and Intraday Movement

The rupee started the session slightly stronger at 90.72 compared to its previous close of 90.74. During the day, it traded in a tight band, indicating cautious market sentiment. The intraday high of 90.64 showed some buying interest in the domestic currency, while the low of 90.78 indicated pressure from dollar demand.

Forex dealers said the movement was largely driven by equity market trends and global currency cues. The tight range suggests that traders were waiting for clearer signals from global economic data and capital flow patterns.

Despite volatility in other emerging market currencies, the rupee managed to remain relatively stable.

Support from Domestic Equity Markets

One of the key factors supporting the rupee was strength in domestic stock markets. The benchmark Sensex rose 173.81 points, or 0.21 percent, to settle at 83,450.96. The Nifty also gained 42.65 points, or 0.17 percent, to close at 25,725.40.

A positive equity market typically attracts foreign investment and improves investor confidence. Even though foreign institutional investors were net sellers on Monday, the overall tone in equities remained firm.

Market participants said improved risk appetite in domestic equities helped cushion the rupee against global pressures.

Impact of Lower Crude Oil Prices

Global crude oil prices softened during the session, providing relief to the Indian currency. Brent crude, the global oil benchmark, was trading 0.83 percent lower at $68.08 per barrel in futures trade.

India is a major importer of crude oil. Lower oil prices reduce the country’s import bill and ease pressure on the current account deficit. This, in turn, supports the rupee.

When crude prices fall, the demand for dollars from oil marketing companies generally declines, which can strengthen the domestic currency.

Analysts noted that the easing of crude prices played an important role in limiting downside risks for the rupee.

Dollar Index Remains Firm

Despite supportive domestic factors, the US dollar remained strong in global markets. The dollar index, which measures the greenback’s strength against a basket of six major currencies, was trading 0.22 percent higher at 97.03.

A firm dollar typically puts pressure on emerging market currencies, including the rupee. Investors tend to move funds toward the US during periods of strong dollar performance, leading to capital outflows from developing economies.

The strengthening of the dollar index reflected optimism around the US economy and expectations related to key economic data releases.

Forex traders said the rupee’s gains were capped by this continued strength in the American currency.

Foreign Institutional Investor Outflows

Foreign institutional investors offloaded equities worth ₹972.13 crore on Monday, according to exchange data. Sustained outflows from foreign investors can weaken the rupee as they involve selling domestic assets and converting proceeds into dollars.

While domestic investors have remained active in the market, FII flows remain an important determinant of currency direction.

Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, said the rupee traded with a slight negative bias due to FII outflows and a positive dollar. However, he added that positive domestic markets and softening crude prices cushioned the downside.

He further said that the USD-INR spot price is expected to trade in the range of ₹90.50 to ₹91 in the near term.

Trade Data and Its Impact

Government data released on Monday showed that India’s exports rose marginally by 0.61 percent to $36.56 billion in January. However, the trade deficit widened to a three-month high of $34.68 billion.

Imports rose 19.2 percent, the highest so far in the current fiscal year, reaching a three-month high of $71.24 billion. The surge in imports was driven by a sharp increase in inbound shipments of gold and silver due to higher prices.

A widening trade deficit can exert pressure on the rupee as it indicates higher demand for foreign currency to pay for imports.

While export growth remained positive, the rise was modest compared to the sharp jump in imports. Analysts said that sustained improvement in export performance would be necessary to provide stronger support to the currency.

Global Economic Cues

Market participants are closely watching key economic data from the United States, including housing market indicators and GDP figures. These data releases can influence the direction of the dollar and, by extension, emerging market currencies.

If US economic data comes in stronger than expected, it could further strengthen the dollar, putting pressure on the rupee.

Conversely, weaker data may ease the dollar’s upward momentum and provide room for the rupee to strengthen.

Global risk sentiment remains sensitive to developments in major economies, including monetary policy decisions and geopolitical events.

Range-Bound Outlook

Analysts believe that the rupee may continue to trade in a range-bound manner in the near term. The projected range of ₹90.50 to ₹91 suggests limited volatility unless triggered by major global developments.

Domestic factors such as equity market performance, oil prices, and capital flows will continue to play a crucial role.

At the same time, the trajectory of the US dollar and global bond yields will remain key external drivers.

Broader Economic Context

The Indian economy has shown resilience despite global uncertainties. Stable growth, controlled inflation, and steady policy measures have helped maintain investor confidence.

However, challenges remain. A widening trade deficit and volatile capital flows can impact currency stability.

Lower crude prices provide temporary relief, but sustained improvement in export competitiveness and capital inflows will be necessary for long-term currency strength.

Role of the Reserve Bank

While there was no specific intervention reported during the session, the Reserve Bank closely monitors currency movements to prevent excessive volatility.

In the past, the central bank has used a mix of market interventions and policy tools to maintain orderly conditions in the forex market.

Stable currency movement is important for economic planning, trade, and investment decisions.

Investor Sentiment

Investor sentiment in financial markets remains cautiously optimistic. Equity gains indicate confidence in corporate earnings and economic prospects.

However, global uncertainties, including monetary policy shifts in advanced economies, continue to influence capital flows.

Forex traders said the rupee’s resilience despite FII outflows reflects underlying stability.

Conclusion

The rupee’s 5 paise gain to close at 90.69 against the US dollar reflects a delicate balance between positive domestic cues and global pressures.

Support from domestic equity markets and lower crude oil prices helped the currency recover from the previous session’s losses. However, sustained foreign institutional investor outflows and a firm dollar index limited the extent of appreciation.

Trade data showing a widening deficit highlights ongoing external challenges. At the same time, stable economic indicators and controlled volatility suggest resilience.

Going forward, the rupee is likely to remain influenced by global economic data, dollar movement, oil prices, and capital flows.

With the USD-INR expected to trade in a narrow range, market participants will continue to monitor both domestic fundamentals and international developments closely.

For now, the modest gain signals cautious optimism in the currency market, even as broader economic factors continue to shape the outlook.

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