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Gold higher at ₹145,310, silver at ₹224,520

Gold and silver prices moved higher on Wednesday, August 5, as investors tracked the latest signals from the Reserve Bank of India (RBI), global interest-rate expectations and geopolitical developments. On the Multi Commodity Exchange (MCX), gold was trading 0.71% higher at ₹1,45,310 per 10 grams, while MCX silver futures gained 1.08% to ₹2,24,520 per kg.

The rise in domestic bullion prices came alongside a supportive global backdrop. Spot gold was holding around $4,100 an ounce, while spot silver moved close to $61 an ounce. Investors were also watching developments around the United States and Iran, particularly reports of progress towards reopening the Strait of Hormuz.

The geopolitical developments have also had an impact on crude oil prices. Brent crude fell below $79 a barrel after signals emerged that US-Iran discussions could make progress. Lower oil prices can ease concerns about inflation, which in turn can influence expectations about interest rates and the appeal of precious metals.

Another important domestic factor was the RBI’s latest monetary policy decision. The central bank kept the repo rate unchanged at 5.25% on Wednesday after its three-day Monetary Policy Committee meeting. The decision was closely watched by markets because interest-rate expectations can influence investment flows into gold and other assets.

Gold does not generate regular interest income, so expectations of lower or stable interest rates can make the metal relatively more attractive to investors. At the same time, movements in the US dollar and the Indian rupee remain important for domestic gold prices.

The dollar index was down about 0.10% at 99.77, according to the latest market update. A softer dollar can support international gold prices because bullion priced in the US currency becomes relatively cheaper for buyers using other currencies.

Retail gold rates also remained elevated across major Indian markets. In New Delhi, 24-carat gold was priced at ₹1,44,780 per 10 grams, while 22-carat gold stood at ₹1,32,315. Mumbai recorded 24-carat gold at ₹1,44,950 and 22-carat gold at ₹1,32,871 per 10 grams.

In Bengaluru, 24-carat gold was available at around ₹1,45,060 per 10 grams, while the 22-carat rate was ₹1,32,972. Kolkata reported 24-carat gold at ₹1,44,760 and 22-carat gold at ₹1,32,697 per 10 grams.

Hyderabad remained among the cities with relatively higher retail gold prices. The 24-carat rate stood at ₹1,45,180 per 10 grams, while 22-carat gold was priced at ₹1,33,082. Chennai recorded one of the highest rates, with 24-carat gold at ₹1,45,370 per 10 grams and 22-carat gold at ₹1,33,256.

Silver prices were also firm. Retail 999-fine silver was quoted at ₹2,23,723 per kg in New Delhi, ₹2,23,923 in Mumbai and ₹2,24,110 in Bengaluru. Chennai recorded a rate of ₹2,24,580 per kg.

In Chennai, the rise was particularly noticeable in the retail market. The price of 22-carat gold increased by ₹160 per gram, taking the rate to ₹13,360 per gram. On a sovereign basis, the price rose by ₹1,280 to ₹1,06,880.

Silver also became costlier in Chennai. The rate increased by ₹5 per gram to ₹240, taking the price to ₹2,40,000 per kg. On August 4, silver was priced at ₹235 per gram.

The latest Chennai gold price is also significantly higher than a year ago. On August 5, 2025, 22-carat gold was priced at ₹9,370 per gram, compared with ₹13,360 per gram on August 5, 2026. That represents an increase of roughly 42.6% over the year.

For consumers, the difference between MCX gold prices and retail gold rates is important. MCX prices reflect futures contracts, while jewellery prices can vary depending on purity, local taxes, GST, jeweller margins and making charges. Buyers therefore may pay more than the quoted bullion rate.

Market participants are now turning their attention to upcoming US economic data, particularly employment figures, for clues about the Federal Reserve’s next policy moves. US labour-market data can influence expectations for interest rates, the dollar and, consequently, global gold prices.

For Indian investors, the movement of the rupee against the US dollar will also remain important. A weaker rupee can make imported gold more expensive domestically, even when international gold prices remain steady.

For now, both gold price today and silver price today remain firmly in focus. With MCX gold holding above ₹1.45 lakh per 10 grams and MCX silver above ₹2.24 lakh per kg, investors and consumers will be watching global bullion prices, crude oil, currency movements, central-bank policy and geopolitical developments for the next major move.

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RBI likely to hold repo rate amid inflation risks

The Reserve Bank of India (RBI) is widely expected to keep the repo rate unchanged at its upcoming monetary policy review, as policymakers balance relatively comfortable domestic inflation with rising risks from global price pressures. The decision comes at a time when several major central banks are reassessing their interest-rate paths as inflation risks remain persistent.

The RBI’s Monetary Policy Committee (MPC) is scheduled to announce its latest policy decision this week. Market participants are largely expecting the central bank to maintain the repo rate at 5.50%, following the sizeable rate cuts delivered earlier this year.

The focus, however, is likely to be less on the rate decision itself and more on the RBI’s assessment of inflation, growth and the changing global economic environment. A pause would allow policymakers to assess how earlier rate reductions are affecting borrowing costs, demand and economic activity before deciding whether further easing is appropriate.

India’s inflation picture has provided the RBI with some room to support economic growth. Consumer price inflation has remained relatively contained compared with the levels seen in recent years. However, policymakers are becoming increasingly cautious about risks that could push prices higher in the months ahead.

Global developments are a major part of that concern. Higher energy prices, geopolitical tensions, currency movements and changes in trade policies can quickly feed into domestic inflation. Any sustained increase in crude oil prices, in particular, could raise transportation and production costs across the Indian economy.

The Indian rupee is another factor the central bank will be watching closely. A weaker rupee can make imported commodities, including crude oil, more expensive. That can create additional inflationary pressure at a time when the RBI is trying to keep price growth firmly under control.

The global interest-rate environment has also become more complicated. While India has moved towards lower borrowing costs, some overseas central banks are facing renewed inflation concerns and may have to maintain or even tighten monetary policy. This divergence can influence capital flows, bond yields and currency markets.

For the RBI, the challenge is to support economic growth without creating conditions that could reignite inflation. Lower interest rates generally encourage borrowing and investment by reducing the cost of loans. They can also support consumption by making home, vehicle and personal loans more affordable.

At the same time, keeping rates too low for too long can create demand-side pressure and make it harder to respond if inflation begins to rise. The central bank therefore has to balance growth with its mandate of maintaining price stability.

The banking and financial markets will also be watching the RBI’s liquidity stance and its comments on financial conditions. While the repo rate is the headline policy tool, liquidity management plays an important role in determining how quickly changes in monetary policy reach borrowers and businesses.

For households, an unchanged repo rate would mean no immediate policy-driven change in floating-rate loans. Borrowers with home loans linked to external benchmarks such as the repo rate would therefore not see another automatic reduction in their lending rates simply because of the latest policy review.

For businesses, the picture is slightly broader. Companies have benefited from lower financing costs as interest rates have eased, but investment decisions depend on more than borrowing costs. Demand conditions, input prices, exports, global trade and consumer confidence will also influence corporate spending.

The RBI is also expected to remain attentive to food inflation. Although headline inflation may appear comfortable, sudden increases in food prices can affect household budgets and influence inflation expectations. Weather conditions, crop output and supply disruptions can therefore remain important variables for the central bank.

The policy decision comes at a crucial point for India’s economy. Growth remains relatively resilient, but policymakers are operating in an uncertain global environment. Geopolitical tensions, shifting trade relationships and volatile commodity markets have made the outlook harder to predict.

A pause in the repo rate would give the RBI time to evaluate these developments without committing itself to either further rate cuts or a tightening cycle. The central bank could retain flexibility to respond if inflation moves sharply in either direction.

Economists and investors will therefore pay close attention to the language used by the MPC rather than simply the rate announcement. Any indication that the RBI is becoming more concerned about inflation could influence bond yields, equity markets and the rupee. On the other hand, a more growth-friendly tone could revive expectations of future rate cuts.

The decision will also matter for financial markets because investors are increasingly comparing India’s monetary-policy direction with that of major global economies. If overseas central banks remain cautious or turn more hawkish while the RBI keeps rates steady, interest-rate differentials could become an important factor for foreign investment flows.

For now, the broad expectation is that the RBI will stay on hold and allow previous policy measures to work through the economy. The central bank’s next moves will depend heavily on the inflation trajectory, domestic growth momentum and the risks emerging from the global economy.

The message from the policy review is therefore likely to be one of caution. With inflation risks still visible despite a relatively benign domestic price environment, the RBI may prefer to wait for clearer evidence before making another move on interest rates.

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Paytm Payments Bank faces final closure

The Delhi High Court has ordered the winding up of Paytm Payments Bank Limited (PPBL), bringing the troubled banking entity closer to its final closure after years of regulatory scrutiny and compliance concerns.

The Reserve Bank of India (RBI) said the High Court, through orders dated July 8 and July 22, 2026, directed that PPBL be wound up under the Banking Regulation Act, 1949, read with the Companies Act, 2013. The court has appointed Girikumar M Nair, a former Chief General Manager of the State Bank of India, as the Official Liquidator.

The liquidator will oversee the winding-up process and exercise the powers assigned under the relevant banking and company laws. According to the RBI, those powers will include taking charge of the affairs of the bank and handling the process of settling its remaining obligations.

The latest court order follows the RBI’s decision on April 24, 2026, to cancel the banking licence of Paytm Payments Bank under Section 22(4) of the Banking Regulation Act.

The RBI said the licence was cancelled because PPBL had failed to comply with regulatory requirements and that its affairs had been conducted in a manner detrimental to the interests of the bank and its depositors. The cancellation took effect from the close of business on April 24.

The central bank had also announced that it would approach the High Court to initiate winding-up proceedings.

At the time, the RBI said PPBL had sufficient liquidity to repay its entire deposit liabilities during the winding-up process. This was an important assurance for customers who still had money associated with the payments bank.

The closure is the culmination of a regulatory process that began several years ago.

In March 2022, the RBI directed Paytm Payments Bank to stop onboarding new customers, citing material supervisory concerns. Restrictions were subsequently tightened after further examinations and compliance reviews.

In January 2024, the RBI ordered PPBL to stop accepting fresh deposits, credit transactions and top-ups in customer accounts, prepaid instruments, wallets, FASTags and National Common Mobility Cards. The deadline for these restrictions was later extended to March 15, 2024.

The RBI’s action effectively separated many of the services customers associated with Paytm from the banking entity itself.

The winding up of Paytm Payments Bank does not mean that the Paytm app itself is being shut down. One 97 Communications, which operates Paytm, has said that its digital payment services continue to operate and that Paytm UPI works through a multi-bank arrangement with other partner banks.

This distinction is important. Paytm and Paytm Payments Bank are separate entities. The RBI’s action is directed at PPBL’s banking licence and does not cancel Paytm’s ability to operate as a digital payments platform.

Paytm has said that services including Paytm UPI, QR payments, Soundbox, card machines, payment gateway, bill payments, recharges, Paytm Gold and Paytm Money remain operational.

For users making UPI payments through Paytm, the money is routed through the bank account linked to their UPI service rather than being held by Paytm Payments Bank.

Customers who still have balances or claims connected to PPBL will have their interests handled through the liquidation process.

The RBI had earlier stated that the bank had adequate liquidity to meet its entire deposit liability while being wound up. The appointment of an official liquidator now provides a formal mechanism for dealing with the bank’s assets, liabilities and customer claims.

The Deposit Insurance and Credit Guarantee Corporation (DICGC) had also cancelled PPBL’s registration as an insured bank following the RBI’s licence cancellation on April 24, 2026.

Customers should therefore distinguish between money held with Paytm Payments Bank and money held in another bank account linked to the Paytm app for UPI transactions.

Paytm Payments Bank was once a major part of India’s fast-growing digital payments ecosystem. Its licence and subsequent restrictions had already forced Paytm to move much of its payments infrastructure away from the bank.

The latest High Court order therefore represents the formal end of the banking entity rather than the end of Paytm‘s broader digital payments business.

For ordinary users, the practical message is relatively simple: Paytm UPI and the Paytm app continue to function, but Paytm Payments Bank itself is being wound up. Customers with old PPBL accounts, wallets or other balances should follow communications from the official liquidator and the RBI regarding settlement and withdrawals.

The case also serves as a reminder that rapid growth in fintech and digital payments does not reduce the importance of KYC compliance, banking regulations, corporate governance and depositor protection. For Paytm, the winding-up order closes one of the most consequential chapters in its evolution from a digital wallet pioneer into a broader financial-services platform.

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Centre clears polymer ₹10, ₹20 notes rollout

The Centre has authorised the Reserve Bank of India (RBI) to issue up to two billion polymer banknotes in the ₹10 and ₹20 denominations, paving the way for a pilot rollout of more durable currency.

The approval allows the RBI to issue one billion notes of each denomination. Unlike paper notes, polymer banknotes are made from flexible plastic, making them more resistant to wear, moisture and dirt while improving security features.

Existing paper notes will continue as legal tender, with polymer notes introduced gradually to reduce replacement costs and improve the lifespan of India’s most frequently used currency. For more quick updates on policy and economic developments, explore our 1-Minute Read section.

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RBI cleared to issue polymer ₹10, ₹20 notes

The Centre has approved the Reserve Bank of India (RBI) to issue up to two billion polymer banknotes in the ₹10 and ₹20 denominations, marking a significant step in the country’s efforts to modernise currency and improve the durability of frequently used notes. The move is expected to reduce the cost of replacing worn-out notes while making everyday cash transactions more efficient.

According to a government notification, the RBI has been authorised to issue one billion ₹10 polymer notes and one billion ₹20 polymer notes under the provisions of the RBI Act. The approval clears the way for the central bank to introduce polymer currency on a pilot scale before considering wider adoption in the future.

Unlike traditional paper currency, polymer banknotes are made from a thin, flexible plastic film. They are more resistant to moisture, dirt and tearing, allowing them to remain in circulation much longer than conventional paper notes. This makes them particularly suitable for lower-denomination currency, which changes hands frequently and tends to wear out quickly.

Officials believe the new polymer banknotes will help reduce the recurring cost of printing replacement notes. Since ₹10 and ₹20 notes are among the most commonly used denominations in India, extending their lifespan could result in significant savings over time while improving the quality of currency in circulation.

The decision does not mean India is replacing all paper currency with plastic notes. Instead, the government and the RBI are adopting a gradual approach by introducing polymer notes only in selected denominations. Existing paper notes will continue to remain legal tender and circulate alongside the new polymer currency.

The RBI has been studying the use of polymer notes for several years. Many countries, including Australia, Canada, the United Kingdom, New Zealand and Singapore, have already switched to polymer currency for most or all of their banknotes. Their experience has shown that polymer notes generally last much longer, remain cleaner and offer better protection against counterfeiting.

Another key advantage of polymer banknotes is enhanced security. The material allows advanced security features such as transparent windows, complex holograms and improved printing techniques that are difficult to replicate. These features make counterfeit currency harder to produce and easier for the public to identify.

The notes are also expected to be more hygienic. Because polymer surfaces absorb less moisture and dirt than paper, they remain cleaner even after prolonged use. This is especially relevant in a country where currency notes pass through millions of hands every day.

The RBI is expected to finalise the design and production process before the new notes enter circulation. While the appearance may be similar to the existing ₹10 and ₹20 notes, the polymer versions are likely to incorporate updated security features and improved durability. The central bank has not yet announced a launch date.

Experts say introducing polymer currency is a practical step rather than a dramatic overhaul of India’s monetary system. By focusing first on low-value denominations, the RBI can assess how the notes perform under Indian climatic conditions, including high temperatures, humidity and heavy daily usage.

The move also aligns with India’s broader efforts to modernise its currency management system. Even though digital payments have grown rapidly in recent years, cash continues to play an important role in the economy, particularly in rural areas and small retail transactions. Ensuring that physical currency remains durable and secure is therefore still a priority.

Industry observers believe polymer notes could also reduce the environmental impact associated with frequent reprinting and disposal of damaged paper currency. Although polymer notes require specialised manufacturing, their longer lifespan means fewer notes need to be produced over time, potentially lowering overall resource consumption.

The approval comes as the RBI continues to strengthen currency security and improve cash management across the country. Alongside technological upgrades in banknote printing and counterfeit detection, the introduction of polymer notes reflects a long-term strategy to make India’s currency more resilient and cost-effective.

For the public, the transition is expected to be seamless. The new polymer ₹10 and ₹20 notes will be used just like existing banknotes and will remain interchangeable with paper currency. There will be no need to exchange existing notes, and all valid paper notes will continue to be accepted for transactions.

As the RBI prepares for the rollout, the initiative is being viewed as an important milestone in India’s currency evolution. If the pilot proves successful, polymer banknotes could gradually become a familiar part of everyday life, offering longer-lasting, cleaner and more secure currency while helping reduce the cost of managing cash across the country.

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Oil rally drags rupee to 96.36

The Indian rupee weakened by 11 paise to 96.36 against the US dollar in early trade on Wednesday, extending its recent losses as global uncertainty, rising crude oil prices and a stronger US dollar continued to weigh on the domestic currency. Currency traders said the rupee remained under pressure as investors shifted towards safer assets amid escalating geopolitical tensions in West Asia.

The latest decline comes at a time when financial markets across the world are grappling with uncertainty over the conflict involving the United States and Iran. Concerns that the situation could disrupt global oil supplies pushed crude prices sharply higher, prompting investors to move away from riskier emerging-market assets and towards the US dollar, traditionally regarded as a safe-haven currency during periods of uncertainty.

One of the biggest reasons behind the rupee’s weakness is the sustained increase in Brent crude oil prices, which climbed above $92 per barrel. India imports nearly 85 per cent of its crude oil requirements, making higher oil prices a major concern for the economy. When crude prices rise, India has to spend more dollars on imports, increasing demand for the American currency and putting pressure on the rupee.

Higher crude prices also have wider economic implications. They increase transportation and manufacturing costs, push up inflation and widen the country’s current account deficit. These factors often reduce investor confidence and create additional pressure on the domestic currency.

Another factor weighing on the rupee is the strengthening of the US dollar index. Expectations that the US Federal Reserve may continue with a cautious approach on interest rates have supported the dollar against most global currencies. Higher US interest rates generally attract global capital into dollar-denominated assets, leading to outflows from emerging markets such as India.

Foreign institutional investors (FIIs) have also remained cautious amid volatile global conditions. Continued selling in Indian equities has increased demand for dollars, contributing to the rupee’s decline. At the same time, importers have stepped up dollar purchases to meet payment obligations, adding to pressure on the local currency.

The weakness in the rupee mirrored the mood in domestic equity markets. Benchmark indices Sensex and Nifty 50 traded sharply lower during the session as investors reacted to rising crude prices and geopolitical tensions. Market experts said global developments are currently having a greater influence on Indian financial markets than domestic factors.

Despite the decline, analysts believe India’s macroeconomic fundamentals remain relatively strong. Healthy foreign exchange reserves, robust economic growth and continued domestic demand are expected to provide some support to the rupee over the medium term. The Reserve Bank of India (RBI) is also closely monitoring currency movements and is expected to intervene whenever necessary to prevent excessive volatility.

A weaker rupee has mixed implications for the economy. Export-oriented sectors such as information technology, pharmaceuticals, textiles and engineering may benefit because their overseas earnings become more valuable when converted into Indian currency. However, industries dependent on imports—including oil marketing companies, airlines, automobile manufacturers and electronics firms—could face higher input costs, which may eventually be passed on to consumers.

Economists say the rupee’s near-term movement will depend largely on global developments. Investors are closely watching crude oil prices, geopolitical tensions, US economic data, Federal Reserve policy signals and foreign investment flows for fresh direction.

If tensions in West Asia ease and crude prices soften, the rupee could recover some of its recent losses. However, any further escalation in the conflict or a sustained rise in oil prices may keep the currency under pressure.

For ordinary Indians, a weaker rupee can make imported goods, overseas education and foreign travel more expensive. Businesses that rely on imported raw materials may also face higher costs. While exporters may gain in the short term, economists believe stability in the currency remains important for sustaining long-term economic growth.

Market participants expect the rupee to remain volatile over the coming days as global developments continue to dominate investor sentiment. Much will depend on how geopolitical tensions evolve and whether crude oil prices stabilise. Until then, currency traders are likely to remain cautious, with every major international development influencing the direction of the Indian rupee.

Also Read: Gold nears ₹145,000, Silver at ₹225,860

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RBI swap window draws $20 bn inflows

The Reserve Bank of India’s (RBI) special foreign exchange swap facility has attracted more than $20.7 billion in foreign currency inflows within just five weeks of its launch, providing a significant boost to the country’s external finances. The strong response comes at a crucial time, with the Indian rupee facing pressure from rising global crude oil prices and continued uncertainty in international financial markets.

According to the RBI, the special window mobilised $20.72 billion between June 8 and July 17, exceeding initial market expectations. The facility was announced on June 5 and became operational three days later as part of the central bank’s efforts to strengthen India’s balance of payments, improve foreign exchange liquidity and encourage banks to attract overseas funds.

The bulk of the inflows came through Foreign Currency Non-Resident (Bank) [FCNR(B)] deposits, which accounted for $17.4 billion of the total amount mobilised. These deposits allow non-resident Indians (NRIs) to maintain fixed deposits in foreign currencies with Indian banks, making them an important source of stable foreign exchange.

Apart from FCNR(B) deposits, the scheme also attracted nearly $2 billion through Overseas Foreign Currency Borrowings (OFCBs) and around $1.3 billion via External Commercial Borrowings (ECBs). Together, these channels have helped bring fresh dollar inflows into the country and strengthened India’s foreign exchange position.

The RBI introduced the swap facility to make it easier and more attractive for banks to raise foreign currency resources from overseas. Under the scheme, the central bank bears the foreign exchange hedging cost for eligible inflows, reducing the financial burden on banks. This enables lenders to offer more competitive returns on FCNR(B) deposits and overseas borrowings, encouraging greater participation from NRIs and international lenders.

The initiative has arrived at an important time for the Indian economy. The rupee has been under pressure in recent weeks due to rising crude oil prices, which have increased India’s import bill, and persistent global uncertainty triggered by geopolitical tensions and shifting interest rate expectations in major economies. These factors have led to increased demand for dollars, putting pressure on the domestic currency.

The fresh inflows generated through the RBI’s swap window are expected to ease some of this pressure by improving the availability of foreign exchange. A stronger forex position also gives the central bank greater flexibility to manage volatility in the currency market without significantly drawing down its foreign exchange reserves.

Higher foreign exchange reserves are widely seen as a key indicator of economic resilience. They help reassure investors that the country has sufficient resources to meet its external payment obligations, finance imports and absorb shocks arising from global financial or geopolitical developments. For an economy like India, which imports a large share of its crude oil requirements, maintaining adequate forex reserves is particularly important.

Market experts say the response to the RBI’s initiative has been stronger than anticipated. Many analysts had expected overseas inflows to remain subdued because of relatively high global interest rates and uncertain financial conditions. Instead, the healthy participation under the scheme suggests that NRIs and overseas lenders continue to have confidence in India’s banking system and long-term economic prospects.

Economists believe the swap facility could play an important role in strengthening India’s balance of payments during the current financial year. Some analysts estimate that total inflows under the scheme could eventually exceed $80 billion if banks continue to mobilise overseas deposits and borrowings at the current pace.

The facility will remain available until September 30, 2026, for FCNR(B) deposits and until December 31, 2026, for OFCBs and ECBs. This gives banks several more months to attract additional foreign currency resources under the concessional framework offered by the RBI.

The latest inflow figures also underline the central bank’s proactive approach to safeguarding the country’s external sector. Alongside regular interventions in the foreign exchange market to smooth excessive currency volatility, the RBI has focused on creating policy measures that attract durable foreign capital instead of relying solely on market intervention.

For businesses and importers, stronger forex reserves and improved dollar liquidity can help reduce uncertainty arising from sharp exchange rate movements. Stable currency conditions also benefit investors by improving confidence in the broader economy and reducing risks linked to external financing.

As global markets continue to face uncertainty from geopolitical tensions, fluctuating commodity prices and evolving monetary policies across major economies, India’s ability to attract substantial foreign currency inflows is being viewed as a positive sign. The RBI’s swap facility has not only strengthened the country’s foreign exchange reserves but has also reinforced confidence in India’s external financial stability, providing an additional buffer against global economic headwinds while supporting the rupee and the overall economy.

Also Read: HDFC Bank pauses CEO reappointment

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Rupee drops 14 paise, closes at 96.44

The Indian rupee extended its losing streak on Tuesday, slipping to a nearly two-month low as rising global crude oil prices and persistent demand for the US dollar overshadowed support from the Reserve Bank of India (RBI). The domestic currency ended the day at 96.44 against the US dollar, reflecting growing concerns over the impact of higher energy costs on India’s economy.

The day’s trading remained volatile. The rupee opened on a weak note and continued to decline through the session before recovering slightly after state-run banks reportedly sold dollars in the market, a move widely viewed as RBI intervention.

Despite these efforts, the currency remained under pressure, highlighting how global developments are increasingly influencing India’s foreign exchange market.

The biggest trigger behind the rupee’s decline was the sharp rise in international crude oil prices. Brent crude climbed after renewed geopolitical tensions raised fears of tighter global oil supplies. As one of the world’s largest crude oil importers, India is particularly vulnerable to such price increases.

When crude becomes more expensive, Indian refiners and importers require larger amounts of US dollars to pay for oil purchases. This higher demand for dollars naturally weakens the rupee.

Adding to the pressure was the continued strength of the US dollar in global markets. Investors have increasingly shifted towards dollar-denominated assets amid expectations that the US Federal Reserve may maintain relatively high interest rates. This has strengthened the dollar against several global currencies, including the rupee.

Currency dealers said importer demand for dollars remained strong throughout the trading session. At the same time, exporter selling was limited, reducing the availability of dollars in the domestic forex market.

Although the RBI is believed to have intervened by selling dollars from its reserves, analysts said the central bank’s role is primarily to prevent sharp fluctuations rather than stop the rupee from adjusting to changing global conditions.

Experts noted that India’s macroeconomic fundamentals remain relatively strong despite the recent depreciation. The country’s substantial foreign exchange reserves, healthy banking system and steady economic growth provide an important cushion against external shocks.

Still, a weaker rupee brings several challenges. Higher import costs can increase inflation, particularly if elevated crude oil prices persist. This may affect transportation costs, manufacturing expenses and household budgets through higher fuel prices.

On the positive side, Indian exporters could benefit from a weaker currency. Companies earning revenue in dollars receive more rupees when converting their foreign income, improving profitability in sectors such as software services, pharmaceuticals, engineering goods and textiles.

Financial markets will now closely monitor upcoming global economic data, movements in crude oil prices and signals from major central banks. Any improvement in geopolitical conditions could reduce pressure on oil prices and provide some support to the rupee.

Analysts expect the currency to remain within a volatile range over the coming weeks. Continued RBI intervention may help prevent abrupt swings, but the overall direction will largely depend on international factors such as energy markets, capital flows and the performance of the US dollar.

For businesses importing goods, the weaker rupee means higher costs. For exporters, it offers a competitive advantage. For consumers, however, prolonged currency weakness could gradually feed into higher prices for imported products and overseas expenses.

As global uncertainties continue to shape financial markets, the rupee’s performance will remain closely tied to crude oil prices and investor sentiment. While the RBI is expected to remain vigilant, the path ahead for the Indian currency will depend largely on how international economic and geopolitical events unfold in the coming weeks.

Also Read: Gold at ₹142,890 while silver climbs to ₹221,330

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Rupee gains 15 paise despite RBI’s dollar challenge

Indian rupee opened stronger on Friday, rising 15 paise to 95.32 against the US dollar in early trade, supported by a weaker greenback in global markets and positive sentiment in domestic equities.

Forex traders said the local currency benefited from easing demand for the US dollar and improved investor confidence. However, gains remained limited as concerns over global trade tensions, crude oil prices and persistent foreign fund outflows continued to weigh on market sentiment.

The rupee’s movement comes at a time when the Reserve Bank of India (RBI) is facing growing challenges in managing the country’s foreign exchange reserves after stepping up interventions to stabilise the currency. According to market estimates, the central bank may need to replenish nearly $100 billion in reserves following extensive dollar sales aimed at defending the rupee against sharp volatility.

The RBI has actively intervened in the foreign exchange market over the past several months to smooth excessive currency fluctuations. While these interventions have helped contain volatility, they have also reduced the stock of foreign exchange reserves, prompting expectations that the central bank could gradually rebuild its dollar holdings when market conditions improve.

Analysts believe the RBI is likely to remain focused on maintaining orderly market conditions rather than targeting a specific exchange rate. They expect the central bank to continue balancing currency stability with adequate liquidity in the financial system.

Meanwhile, investors are closely tracking global developments, including US economic data, expectations around Federal Reserve interest rate decisions and geopolitical tensions, all of which influence the direction of the dollar and emerging market currencies.

Also Read: Onida names Gunjan Srivastava CEO and MD

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RBI starts three surveys ahead of policy

The Reserve Bank of India (RBI) has launched three important surveys to gather feedback from households, businesses and professional forecasters, as it prepares for its upcoming monetary policy decisions.

The surveys are designed to help the central bank understand inflation expectations, business conditions and the broader economic outlook. The findings will provide valuable inputs to the Monetary Policy Committee (MPC) while deciding the future course of interest rates.

One of the surveys focuses on Inflation Expectations of Households, covering nearly 6,000 urban households across 19 major cities. Participants are being asked about their expectations for price changes over the next three months and one year. The survey captures perceptions on the prices of food, housing, fuel, transport and other essential items that directly affect household budgets.

The RBI has also begun its Industrial Outlook Survey, which collects responses from manufacturing companies on production, order books, capacity utilisation, employment and overall business confidence. The survey helps the central bank assess how industries expect business conditions to evolve in the coming months.

The third exercise is the Survey of Professional Forecasters, involving economists, research institutions and market experts. They provide projections on key economic indicators such as GDP growth, inflation, interest rates, exchange rates and other macroeconomic variables.

The RBI clarified that the survey results reflect the views of respondents and should not be treated as the central bank’s official assessment or policy stance.

The latest round of surveys comes at a time when inflation has moderated and the RBI continues to closely monitor domestic demand, global uncertainties and changing financial conditions. Policymakers are expected to use the findings alongside economic data while assessing risks to growth and inflation.

By collecting regular feedback from consumers, businesses and experts, the RBI aims to gain a clearer picture of the economy beyond official statistics.

Also Read: SBI sells 1.42% stake for ₹1,655 cr ahead IPO