The rupee rebounded after hitting its weakest level in two weeks and ended nearly unchanged on Thursday, as likely intervention by the central bank and softer oil prices offset dollar demand. The rupee ended at 95.26 against the dollar, barely changed from its close at 95.22 in the previous session. It had declined to its weakest level since October 12 earlier in the session, pressured by clustered dollar demand at the Reserve Bank of India's daily reference rate alongside a pickup in interbank appetite to take on short rupee wagers. Likely intervention by the Reserve Bank of India capped the losses and, as the flow-linked demand faded towards the end of the session, the rupee found comfort in softer oil prices, traders said. Oil prices fell as hopes for peace talks took the edge off renewed concerns over Middle East supply disruptions from escalating regional conflict. Dollar eased against most major currencies in the wake of data showing rising US inflation. US Commerce Department data showed that inflation accelerated in September as consumers paid more for gasoline and other goods, supporting economists' expectations of an interest rate increase from the Federal Reserve in December. The Fed had opted to delay any changes to borrowing costs until after next week's mid term elections. The dollar has not reacted significantly to the latest economic events largely because much of it had been as expected and had already been priced in. The euro edged higher on Thursday after the European Central Bank kept interest rated unchanged. The pound held mostly steady on Thursday, a day after finance minister John Healey’s that offered a cautious set of tax and spending plans to help households hurt by "global economic storms", which had minimal impact on UK markets. Sterling , which is the best-performing major currency against the dollar this month, with a 0.52% gain, was last flat on the day at $1.3325. The euro was last down 0.1% at 83.62 pence. Gold dropped 1% on Thursday as data showing elevated US inflation reinforced expectations of ?a Federal Reserve interest rate hike later this year, reducing the appeal of the non-yielding metal. Spot gold was down 1.1% at $4,024.10 per ounce by 11:53 a.m. EDT (1553 GMT). US gold futures for December delivery fell 0.4% to $4,036.40 per ounce. Bullion is on track for its second straight monthly decline. Spot silver fell 2.7% to $52.51 per ounce, platinum dropped 3.5% to $1,479.20 and palladium slid 0.7% to $1,004.11. All three metals were headed for a second straight monthly decline.
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The euro rebounded on Tuesday and was on pace for its strongest move higher in a month after falling to its lowest in 17 months in the prior day, as a pullback in French government bond yields cooled fears about strain in euro zone debt markets. The euro zone's currency climbed 0.28%, on track for its biggest daily gain since September 3, at $1.1252. the currency had slid to its lowest since May 2025 on Monday at $1.116, following a drop of more than 1% in the prior week, its fourth straight weekly decline. The dollar index , which measures the greenback against a basket of currencies, fell 0.26% to 101.89 and was on pace for its biggest daily drop since September 25. Bond markets around the world have seen yields rise due to expectations of sharp central bank rate hikes as energy prices have jumped due to the US-Israeli war with Iran and fanned inflation, as well as concerns about government finances. France is at the heart of the European market concerns. The French government is seeking to enact an unpopular 2027 budget to lower its deficit and contain its record-high debt load, a tall order in a deeply divided parliament as political factions position ahead of next year's presidential election. With inflation already rising on soaring energy costs and higher yields increasing household and corporate borrowing costs, further euro weakening could leave the European Central Bank caught between fighting inflation and calming bond markets.
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