The Indian rupee rose 2% this week to post its biggest weekly gain in seven months, buoyed by policy measures aimed at boosting the currency, though analysts reckon a sustained ‌turnaround hinges on an easing of underlying strains. The currency closed at 94.96 per dollar, up 0.1% on the day. It recovered after threatening to breach its record low of 96.96 hit last week. Policymakers have moved to support the rupee by redirecting oil dollar demand away from the market, raising the cost of buying protection against a weaker rupee and slashing the limit for dollar purchases without underlying documentation proving exposures by 95% to $5 million. Traders and analysts said that the measures are likely to sap depreciation pressure in the near to medium term, but a meaningful recovery without central bank interventions would require a broader shift in conditions. There is growing consensus that unless oil prices collapse, USD-INR faces upward pressure over time due to India’s wider current account deficit, inflation differential, lack of catalyst for portfolio inflows, and the RBI’s short FX forward position. Sterling was on track for a third consecutive weekly gain against the euro as the single currency remained under pressure following the French bond selloff at the turn of the month, with investors closely watching UK economic data ‌and the fiscal trajectory. The dollar was on track for its first weekly decline in more than a month against the euro and the yen, as investors shifted their focus to the US rate outlook while assessing the ‌impact of Wednesday's stock market selloff. The pound hit its highest level against the dollar in more than three weeks on Friday and was set to snap a four-week losing streak. The euro recently touched its lowest level of the year against the pound, suggesting markets are confident the UK government can strike a balance between maintaining fiscal discipline and ‌supporting growth. Still, recent experience suggests investors should not underestimate the residual risks surrounding the UK's fiscal plans. The single currency was on track for a 0.24% weekly fall versus the pound and was last down 0.12% at 84.41 pence on Friday. . It reached 84.28 pence on Wednesday, its lowest since June 2025. Sterling was set for a weekly rise of 0.66% against the dollar and was last up 0.40% at $1.3329, its highest level since September 23. The yen was on track for a 0.24% weekly rise after dropping for four consecutive weeks as the Iran conflict supported the greenback. It was last up 0.05% at 157.89. Higher oil prices tend to boost the dollar while weighing on energy-importing currencies such as the euro and yen. Oil prices steadied on Friday and were heading for weekly gains on uncertainty over Middle East supplies and a larger-than-expected draw from US crude ‌stockpiles, while European diesel margins dropped after an IEA move to release more of the fuel. Brent crude futures were flat at $105.92 a barrel at 1311 GMT, while US West Texas Intermediate crude futures were down 22 cents, or 0.2%, to $97.75. So far this week, Brent has risen 1.2% and WTI 6.5%. Gold gained support from the weaker dollar, rising to about $4,174.52 an ounce.