The rupee depreciated 20 paise to 90.07 against the U.S. dollar in early trade on Wednesday (December 10, 2025), facing pressure from importer dollar demand, tariff concerns and market anticipation of U.S. Fed Reserve policy decision.

Forex traders said all eyes will be on the U.S.-India trade talks which could give some positivity to the rupee in the coming days.

India and the United States will commence three-day talks on the first phase of their proposed bilateral trade agreement in Mumbai from December 10.

At the interbank foreign exchange, the rupee opened at 90.00 against the U.S. dollar, then lost ground and fell to 90.07 against the dollar.

On Tuesday (December 9), the rupee settled at 89.87 against the U.S. dollar. “The rupee is expected to remain in the trading range of 89.70-90.20 for the day as the dollar index rose to 99.20 level,” said Anil Kumar Bhansal, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

“Market is focused on the stance the U.S. Federal Reserve chairman Jerome Powell will deliver in the U.S. Fed meeting this week,” traders said.

Meanwhile, the dollar index, which gauges the dollar’s strength against a basket of six currencies, was trading 0.01% higher at 99.23 amid anticipation of a hawkish rate cut from the Fed.

Brent crude, the global oil benchmark, was trading higher by 0.19% at $62.06 per barrel in futures trade. On the domestic equity market front, the 30-share benchmark index Sensex was trading 134.71 points higher at 84,800.99, while the Nifty was up 41.50 points at 25,881.15.

Foreign Institutional Investors (FIIs) sold equities worth ₹3,760.08 crore on Tuesday, according to exchange data.

The rupee pared its initial losses and settled for the day in the positive territory, up 17 paise at 89.88 (provisional) against the U.S. dollar on Tuesday (December 9, 2025), as American currency and crude oil prices retreated from their elevated levels.

​Limited room: On the Indian rupee

Forex traders said the weakness of the U.S. dollar in the overseas market, amid expectations of a U.S. Fed rate cut in December, supported the rupee at lower levels.

However, a negative trend in domestic equities and foreign fund outflows weighed on investor sentiment, limiting the local unit’s appreciation.

Moreover, investors are in a wait-and-watch mode, and market participants are awaiting clarity from the U.S. Federal Reserve before taking decisive positions.

At the interbank foreign exchange market, the rupee opened at 90.15 against the U.S. dollar, down 10 paise from its previous close. The domestic unit recovered losses and settled for the day in the positive territory at 89.88 (provisional), up by 17 paise from its last close.

On Monday (December 8), the rupee settled at 90.05 against the U.S. dollar.

Anuj Choudhary, Research analyst, Mirae Asset ShareKhan, said the rupee recovered from lower levels on likely intervention by the RBI and overnight decline in crude oil prices. However, weak domestic markets and a slight recovery in the U.S. dollar index capped sharp gains.

“U.S. dollar is also expected to remain weak on expectations of rate cut by the Fed in December. Any further intervention by the central bank may also support the rupee. USD-INR spot price is expected to trade in a range of ₹89.50-90.30,” he said.

Meanwhile, the dollar index, which gauges the dollar’s strength against a basket of six currencies, was trading 0.10% lower at 98.98.

Brent crude, the global oil benchmark, was trading 0.27% lower at $62.33 per barrel in futures trade.

Forex traders said investors’ focus has now shifted to the Fed’s policy outcome on December 9-10. Markets are placing nearly a 90% probability on a rate cut next week.

Meanwhile, India and the United States will commence three-day talks on the first phase of their proposed bilateral trade agreement here from December 10.

On the domestic equity market front, Sensex dropped 436.41 points to settle at 84,666.28, while the Nifty fell 120.90 points to 25,839.65.

Foreign Institutional Investors (FIIs) sold equities worth ₹655.59 crore on Monday (December 8), according to exchange data.