The Indian rupee began its trading day on Monday, October 27, 2025, with a notable drop, weakening by 12 paise to trade at 87.95 against the resilient US dollar. This downward movement was primarily influenced by two key factors: a steady climb in global crude oil prices and a renewed sense of optimism regarding a potential trade deal between the United States and China.
Currency market participants pointed out that the upward trend in crude oil prices stemmed directly from the anticipation of this US-China trade agreement. Such a deal is expected to significantly boost global economic activity, consequently driving up demand for oil worldwide.
Specifically, in the interbank foreign exchange market, the rupee started trading at 87.87 before quickly sliding to 87.95 against the American currency. This marked a 12-paise decline from its closing rate on the previous trading day.
Just last Friday, October 24, 2025, the rupee had shown some strength, gaining 5 paise to close at 87.83 against the US dollar.
According to Amit Pabari, Managing Director of CR Forex Advisors, the rupee is currently balancing between a cautious outlook and hopeful expectations. He suggests that if the currency can fall below the 87.50 mark, it might see further appreciation, potentially reaching the 86.80–87 range in the near future. Conversely, strong resistance is anticipated if it approaches the 88.30–88.40 level.
In contrast to the rupee’s movement, the dollar index, which measures the US dollar’s value against six major global currencies, saw a marginal dip of 0.04%, settling at 98.91.
The global benchmark for oil, Brent crude, also saw a slight increase, rising by 0.02% to reach ₹65.95 per barrel in futures trading.
Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, noted that ongoing US sanctions against Russia continue to influence market dynamics. He emphasized that traders are closely monitoring global trade negotiations and geopolitical developments, as these factors are crucial in shaping energy market sentiment and determining future price trends.
Domestically, Indian equity markets showed positive momentum in early trade. The Sensex surged by 272.7 points to 84,484.58, and the Nifty climbed 88.55 points, reaching 25,883.70.
Data from exchanges revealed that Foreign Institutional Investors (FIIs) were net buyers on Friday, October 24, 2025, investing a significant ₹621.51 crore into equities.
The Reserve Bank of India (RBI) reported on Friday that India’s foreign exchange reserves saw a substantial increase of $4.496 billion, reaching a total of $702.28 billion for the week ending October 17. This rise was primarily driven by a continued increase in the value of gold reserves.
This follows a previous week’s increase where overall reserves had already grown by $2.176 billion, reaching $697.784 billion.