Rupee gains 6 paise to 89.92 against US dollar in early trade

The Indian rupee opened the first trading session of 2026 on a slightly positive note, appreciating by 6 paise to 89.92 against the US dollar , as thin liquidity conditions amplified routine demand-supply imbalances, keeping the currency’s trajectory modest.

At the interbank foreign exchange market, the rupee began at 89.95 and quickly strengthened to 89.92. On Thursday, the currency had slipped 10 paise to 89.98. Forex traders expect the USD/INR pair to remain in a narrow band, with the 90 level closely monitored and defended by the Reserve Bank of India (RBI) .

The modest rise in the rupee is attributed to a mix of factors: thin early-year liquidity, mild support from positive equity markets, slight weakness in the US dollar, and expectations that the RBI will continue to manage volatility around the 90 mark. These factors collectively helped the rupee gain a few paise despite ongoing foreign fund outflows.

“Unless the RBI intervenes with significant dollar sales, the rupee is likely to continue moving in small ranges, as observed over the past three sessions. The currency is holding between 89.80 and 90,” said Anil Kumar Bhansali , Head of Treasury and Executive Director at Finrex Treasury Advisors LLP . He added that corporate, government, and foreign portfolio investor (FPI) demand have been the main drivers of rupee movements over the past year, during which it depreciated over 5 per cent, making it the worst-performing Asian currency, though partially supported by RBI interventions.

Meanwhile, the dollar index, which tracks the greenback against six major currencies, was marginally down 0.15 per cent at 98.17. Brent crude oil futures were up 0.38 per cent at USD 61.08 per barrel.

“With early-year liquidity still thin and domestic fundamentals stable yet mixed, the rupee is likely to remain range-bound in the near term. As long as USD/INR stays below 90, the balance of risks favors the rupee,” noted Amit Pabari , MD of CR Forex Advisors , projecting the USD/INR to trade between 89.30 and 90.20.

On the domestic equity front, the BSE Sensex rose 158.19 points to 85,346.79, while the Nifty 50 gained 55.8 points to 26,202.35. However, foreign institutional investors (FIIs) offloaded equities worth Rs 3,268.60 crore on Thursday, according to exchange data.

On the macroeconomic side, gross GST collections in December 2025 rose 6.1 per cent to over Rs 1.74 lakh crore, compared with Rs 1.64 lakh crore in the same month last year. The slower growth was attributed to muted domestic sales following the government’s sweeping tax cuts.