The Indian rupee declined by 15 paise to settle at 95.32 against the U.S. dollar on Monday (August 10, 2026), as reported by Business Standard. The local unit opened at 95.18 and traded in a narrow range of 95.18-95.32 during the day before settling at 95.32 (provisional), down from its previous close of 95.28 on Friday (August 7, 2026). The slight weakness was attributed to the rise in Brent crude above $84 and the consequent expected impact on trade deficit, according to V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments Ltd. However, positive foreign institutional investor (FII) inflows, which have turned positive in July and are increasing in August, though in small quantities, are providing support to the rupee. The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 99.66, up 0.13%, while Brent crude, the global oil benchmark, was trading higher by 0.96% at $84.35 per barrel in futures trade.
State-run banks were spotted offering dollars through most of the session, most likely on behalf of the Reserve Bank of India, as reported by The Economic Times. The dollar selling has helped the rupee defy rising oil prices as talks to reopen the Strait of Hormuz were tempered by Iran's insistence that the United States must satisfy several demands before the key energy route can reopen. The RBI's resolute defence of the currency over recent trading sessions has made traders wary of betting against the rupee, with the central bank's intervention providing crucial support against oil market pressures. The RBI data released on Friday (August 7, 2026) showed that the country's forex reserves jumped by ₹10.512 billion to ₹692.866 billion during the week ended July 31, providing additional support to currency stability.
Brent crude oil futures were hovering around $84.35 per barrel as uncertainty persisted over the reopening of the Strait of Hormuz, as reported by The Hindu. Lack of any breakthrough in talks in West Asia put further pressure on the local unit, while the overnight surge in crude oil prices contributed to the rupee's decline. The rise in Brent crude above $84 and the consequent expected impact on trade deficit contributed to the rupee's decline, as noted by The Hindu BusinessLine. The dollar sales also blunted the impact of an uptick in oil prices and heightened demand to buy dollars at the central bank's daily reference rate, which often attracts concentrated dollar buying or selling. Crude oil prices are likely to remain a key driver of the rupee this week amid uncertainty in the West Asia, as per CNBC TV18. India imports most of its crude oil requirements, so a sustained rise in global oil prices can increase the country's import bill and demand for dollars, putting pressure on the rupee.
On the domestic equity market front, Sensex ended 43.27 points, or 0.06%, up at 78,542.44, while Nifty saw a marginal rise by 13.15 points, or 0.05%, to 24,583.80, as reported by Business Standard. Foreign institutional investors purchased equities worth ₹480.24 crore on a net basis on Friday (August 7, 2026), according to exchange data. The rupee's movement above the 95-per-dollar level could face resistance, but the recovery from Thursday's lows suggests that the broader trend remains positive. Traders may remain cautious ahead of the U.S. inflation data this week, with USDINR spot price expected to trade in a range of ₹95-95.60. Local shares ended a lackluster session little changed on Monday as uncertainty over the reopening of the Strait of Hormuz overshadowed growing expectations that the U.S. Federal Reserve will not raise interest rates next month.
"The 96 level seems to be emerging as a hard line against rupee weakness," a trader at a private bank said, noting that the unit is likely to continue strengthening in the near term, as reported by The Economic Times. Analysts at ING said in a note that they remain "constructive on the INR," on the back of policy measures aimed at drawing dollar inflows. The firm expects the rupee to rise to around 94.50 in three months and 94 in six months. "The rupee declined on Monday on uncertainty over a deal between the U.S. and Iran and overnight surge in crude oil prices. U.S. dollar strengthened from lower levels. However, positive domestic markets cushioned the downside," Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, said. A Reuters poll of 40 economists has forecast that India's inflation rate, measured by the annual change in the consumer price index (CPI), will rise to 4.50% in July from 4.38% in June.
