Rupee sheds 39 paise against dollar

India’ strike against terror infrastructure in Pakistan and the fall in equity markets in early trading dragged the rupee down on Wednesday to its biggest single-day drop in a month even as the dollar gained ground against global currencies.

The rupee, which opened about 14 paise weaker on Wednesday, closed at 84.8250 per US dollar, down about 39 paise vs previous close of 84.44.

Indian defence forces launched missile strikes early Wednesday on nine terror targets in Pakistan to avenge the killing of 26 tourists in Pahalgam (Kashmir) by terrorists sponsored by the latter. This dampened the sentiment in the forex and equity markets (in early trading).

While the equity markets recovered, ending the day in green, the currency market was weighed down by the tension along the Indo-Pak border, with the neigbouring country resorting to unprovoked firing.

Dilip Parmar, Senior Research Analyst, HDFC Securities, said that amidst lingering geopolitical concerns and a stronger dollar index, the Indian rupee experienced its most significant single-day drop in a month, continuing its decline for the second day.

“The easing of trade tensions has allowed the dollar to rebound, negatively impacting major currencies. Furthermore, consistent dollar demand from oil importers and hedgers have exerted downward pressure on the rupee over the past two days.

“Spot USDINR is anticipated to trend upward, potentially reaching 85.70 if it holds above 85. Conversely, 84.25 presents a significant support level,” per his assessment.

Published on May 7, 2025