Rupee At ₹95.43 Against Dollar: Why ₹97 Could Be The Next Big Test For The Indian Currency

The rupee’s marginal recovery to ₹95.43 against the US dollar on Friday offers little comfort as a combination of higher crude prices, strong demand for dollars and continuing geopolitical uncertainty keeps the currency under pressure.

The rupee opened at ₹95.39 and moved to ₹95.43 in early trade, helped by a softer dollar in global markets. But the relief remained limited as rising oil prices threatened to offset the benefit from a weaker greenback.

The Reserve Bank of India (RBI) has emerged as an important stabilising force in the currency market. The central bank is believed to be intervening through state-run banks by selling dollars to prevent excessive volatility. Such intervention has helped keep the rupee around the ₹95.40 level and has so far limited a sharper fall.

The pressure is closely linked to India's heavy dependence on imported crude. With the country importing around 90 per cent of its oil requirements, a sustained rise in global crude prices increases the dollar bill for Indian refiners and raises demand for the US currency. The ongoing uncertainty in West Asia has added to concerns over future oil supplies.

The RBI has also maintained the repo rate at 5.25 per cent, extending its policy pause while retaining a neutral stance. Rather than tightening monetary policy to support the currency, the central bank appears to be relying more on direct foreign-exchange intervention while keeping borrowing conditions supportive for the domestic economy.

The near-term outlook could become more challenging if crude prices rise further. Market levels indicate ₹96.20 as an important point to watch for the dollar, while a sustained breach could bring ₹97 per dollar into focus.

The rupee has already come close to that level earlier this year. A fresh surge in oil prices, stronger importer demand for dollars or a deterioration in global risk sentiment could therefore push the currency towards ₹97 once again.

For now, the RBI's intervention is providing a cushion. But the key question is whether that support can continue to contain the rupee if external pressures intensify.