Indian rupee stares at new low beyond 92 on offshore-led dollar rush, weak Asia

MUMBAI: The Indian rupee is poised to breach the 92-per-dollar level for the first time at open on Thursday, pressured by the US dollar’s rally in the non-deliverable forward markets and broad weakness across Asian currencies, with traders on alert for possible central bank intervention.

The 1-month non-deliverable forward indicated the rupee will open in the 92.02-92.08 range versus the US dollar, having settled at 91.7825 on Wednesday.

This puts the currency on course to breach its prior all-time low of 91.9650 set last week.

The dollar/rupee 1-month deliverable forward continued to climb after usual local trading hours, touching nearly 92.50, a Singapore-based hedge fund portfolio manager said.

“I am a bit surprised by the extent of the move,” he said. “It looks like the market is pre-empting expected NDF maturities, and it’s possible a round of stop-losses has been triggered.”

The key question now is how the Reserve Bank of India reacts if the rupee slips past 92, whether it allows dollar/rupee to reprice higher or steps in to pull it back, he said.

He added that the dollar may have found some support from comments by U.S. Treasury Secretary Scott Bessent, though the impact was likely marginal.

The dollar index recovered slightly on Wednesday. The Federal Reserve’s policy decision had little overall impact on the dollar, while US Treasury yields rose after the Fed acknowledged that inflation remained elevated and the labour market continued to stabilize.

During the press conference, Chair Jerome Powell remained noncommittal about conditions for future cuts.

“Our economists believe further easing primarily depends on evidence of disinflation, which will likely come later in 2026. Hence, they retain their outlook for rate cuts in June and September,” analysts at Morgan Stanley said in a note.

Asian currencies were mostly down on the day, pressured by the rise in US yields.