Rupee strengthens 1.6% to settle at 93.18 against USD after RBI measures

Mumbai: The rupee logged one of its steepest single-day gains in many years and settled 152 paise higher at 93.18 against the US dollar on Thursday after the Reserve Bank stepped in with a slew of measures to restrict banks from onshore forward markets.

The domestic unit, however, remained under pressure due to the unabated withdrawal of foreign capital, a strengthening dollar, and rising crude oil prices amid a volatile geopolitical situation, forex analysts said.

At the interbank foreign exchange, the rupee opened at 94.62 and registered a sharp single-day surge of 188 paise to touch an intra-day high of 92.82 against the greenback.

At the end of the session, the rupee was quoted at 93.18 against the dollar, higher by 152 paise, or 1.6 per cent, from its previous closing level.

The local currency breached the 95-level on Monday before closing at 94.70 versus the greenback. It had settled at a historic low of 94.84 against the dollar on Friday, prompting the RBI to intervene with multiple measures.

The forex markets were closed on Tuesday due to a holiday on Shri Mahavir Jayanti and on Wednesday due to the annual account closure of banks.

According to Jateen Trivedi, VP Research Analyst, Commodity and Currency, LKP Securities, the rupee recovered after extreme weakness, largely driven by improved risk sentiment after US President Donald Trump hinted at negotiations rather than escalation.

"The recovery appears more of a technical pullback after sharp depreciation rather than a trend reversal. Near-term support for rupee is seen near 92.50 and resistance at 93.50," Trivedi said.

Through its circular dated March 27, 2026, the RBI capped the net open position on the Indian rupee for banks at USD 100 million, mandating compliance by April 10.

On Wednesday, the RBI announced more measures for banks and forex dealers following a "review of evolving market conditions".

It said banks authorised to deal in foreign exchange will not be able to offer non-deliverable derivative contracts involving the rupee to resident or non-resident users.

Besides, the central bank also restricted the users from rebooking any foreign exchange derivative contract, whether deliverable or non-deliverable, which is cancelled after the date of issuance of these instructions.

Since the beginning of the West Asia war on February 28, 2026, the rupee has depreciated by over 4 per cent. During the fiscal year ended March 2026, the currency declined nearly 10 per cent against the US dollar.

Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan, said the rupee recorded the biggest one-day gain in over 12 years, driven by regulatory curbs by the RBI on banks. "This led to the selling of dollars by the banks to comply with regulatory requirements."

He said the rupee is expected to trade with a positive bias as banks may continue to liquidate their open positions ahead of the April 10th deadline.

"However, global risk-off sentiments and rising crude oil prices may continue to pressure the rupee at higher levels," he said, adding, "USD-INR spot price is expected to trade in a range of Rs 92.20 to Rs 93.20."

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.60 per cent higher at 100.05.

Brent crude, the global oil benchmark, was trading at USD 108.08 per barrel, up 6.84 per cent, in futures trade.

On the domestic equity market front, Sensex settled at 73,319.55, higher by 185.23 points, or 1.80 per cent, while the Nifty closed 33.70 points, or 0.15 per cent, up at 22,713.10.

Foreign institutional investors sold equities worth Rs 9,931.13 crore on a net basis on Thursday, according to exchange data.

Government data released on Wednesday showed that the government's GST revenues grew about 9 per cent in March, scaling to the pre-tax cut level of over Rs 2 lakh crore, the third highest monthly collection in the 2025-26 fiscal year, buoyed by mop-ups from imports as well as domestic sales and purchases.

Equity and forex markets will remain closed on Friday due to Good Friday.