The rupee witnessed range-bound trading in morning deals on Monday (September 22, 2025) and depreciated 5 paise to 88.21 against the U.S. dollar, as the strength of the American currency in the overseas market and a negative trend in domestic equities weighed on investor sentiments.

Forex traders said the recent hike in H-1B visa fees to $100,000 per year could trigger a sensitivity move in the IT sector, as companies may face margin pressure and reduced remittances due to the potential slowdown in employee deployments to the U.S..

At the interbank foreign exchange market, the rupee opened at 88.20, then lost ground and touched 88.21 against the U.S. dollar, registering a decline of 5 paise over its previous close.

On Friday (September 19, 2025), the rupee appreciated 4 paise to close at 88.16 against the U.S. dollar.

On the H-1B visa fees hike, CR Forex Advisors MD Amit Pabari said, beyond the sectoral impact, India’s overall services exports could also take a hit if overseas deployments are curtailed, thereby affecting the country’s external balances.

“This policy shock is likely to weigh on investor sentiment, contribute to equity outflows from the Indian IT sector in the near term, and could also exert pressure on the Indian rupee,” Mr. Pabari added.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.13% to 97.77.

Brent crude, the global oil benchmark, was trading 0.66% higher at $67.12 per barrel in futures trade.

Prime Minister Narendra Modi asserted on Sunday (September 21, 2025) that the GST reforms kicking in from Monday (September 22, 2025) will accelerate India’s growth story, “Aatmanirbhar Bharat”, and provide a boost to ‘swadeshi’ products to the country’s prosperity.

On the domestic equity market front, the Sensex dropped 475.16 points to 82,151.07 in opening trade, while the Nifty declined 88.95 points to 25,238.10.

Foreign Institutional Investors bought equities worth ₹390.74 crore on a net basis on Friday (September 19, 2025), according to exchange data.

India’s forex reserves jumped $4.698 billion to $702.966 billion for the week ended September 12, the Reserve Bank of India said on Friday (September 19, 2025).

In the previous reporting week, the overall reserves had increased $4.038 billion to $698.268 billion.

Meanwhile, Commerce and Industry Minister Piyush Goyal will lead an official delegation to the U.S. for trade talks on September 22.

The delegation plans to hold talks with the U.S. team to take forward discussions with a view to achieving an early conclusion of a mutually beneficial trade agreement.

The minister will visit New York and will be accompanied by the special secretary in the ministry, Rajesh Agrawal, and other officials.

The rupee depreciated 14 paise to close at 86.30 (provisional) against the U.S. dollar on Monday (July 21, 2025) due to consistent dollar demand from oil importers.

Forex traders said after breaching the crucial 86 level, the rupee continued its decline, which intensified the downward trend, tracking a strengthening dollar index.

At the interbank foreign exchange, the domestic unit opened at 86.27 against the greenback and touched an intra-day high of 86.19 and a low of 86.36 against the greenback.

At the end of Monday’s (July 21, 2025) trading session, the local unit settled at 86.30, down 14 paise over its previous closing price.

On Friday (July 18, 2025), the rupee settled 4 paise lower at 86.16 against the U.S. dollar.

Forex traders said all eyes are now on the outcome of India-U.S. trade talks, especially as the August 1 deadline for potential tariffs on Indian exports draws closer. If the discussions fail or get delayed, it will add to the rupee’s challenges, and if a deal is reached, it could offer a much-needed breather.

The uncertainty around the India-U.S. trade deal is likely to keep market participants cautious, they added.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.22% to 98.26.

Brent crude, the global oil benchmark, fell 0.48% to $68.95 per barrel in futures trade.

“The Indian rupee has experienced considerable weakness in recent days and remains the weakest among Asian currencies,” the traders said.

“The primary catalysts for this decline are consistent dollar demand from the importers and a continued exodus of foreign capital. On the technical front, the spot USD/INR has immediate resistance at 86.65 and a significant support at 85.80,” said Dilip Parmar, Research Analyst, HDFC Securities.

In the domestic equity market, the 30-share BSE Sensex advanced 442.61 points, or 0.54%, to 82,200.34, while the Nifty rose 122.30 points, or 0.49%, to 25,090.70.

Foreign institutional investors (FIIs) purchased equities worth ₹374.74 crore on a net basis on Friday (July 18, 2025), according to exchange data.