CURRENCY OVERVIEW

The Rupee reversed course and fell for the fourth consecutive session on Monday, pressured by corporate dollar buying that was further complicated by a shortfall in supply. The local unit found early support as the dollar weakened against major peers and Asian currencies, with investors paring dollar exposure amid mounting tensions over Greenland and threats of U.S. tariffs on European nations. The rupee ended at 90.91 to the dollar, its lowest closing level since December 16. It settled at 90.8650 on Friday. The rupee has breached the key zone of 90.30–90.50, with the all-time high of 91.0750 as the next major level to monitor, he added. The currency's inability to hold on to its opening advance underscores the current balance in the forex market, where any form of recovery is offset by corporate dollar demand and an overall lack of supply. Apart from this, outflows from equity markets also continue to hurt sentiment. Foreign investors have withdrawn over $2.5 billion from Indian stocks so far in January. The U.S forex market was closed on Monday, January 19, due to the Martin Luther King Jr public holiday. Reuters will resume the reports during Asian trading hours on Tuesday January 20.  Sterling rose on Monday as markets looked to UK economic data points due throughout the week, while U.S. President Donald Trump's tariff threats against Europe over Greenland raised geopolitical concerns. The pound was up 0.16% to $1.3402. It ended the previous week down 0.13%. The euro was flat against the pound at 86.75 pence . So far this year, the pound is down around 0.5% against the dollar, yet has strengthened a similar amount against the euro. In the coming days, November UK employment data, as well as December inflation and retail sales figures are due. Trump over the weekend said an additional 10% tariff would be applied to goods from Denmark, Norway, Sweden, France, Germany, the Netherlands, Finland and Britain from February 1 until the United States can buy Greenland. Oil prices steadied on Monday as civil unrest in Iran subsided, reducing the likelihood of a U.S. attack that could disrupt supplies from the major producer, while market-watchers turned their attention to the stand-off over Greenland.Brent crude was up one cent, or 0.02%, at $64.14 a barrel by 1650 GMT.

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The rupee closed modestly weaker on Wednesday as dollar demand from local corporates and on account of maturing positions in the non-deliverable forward (NDF) market blunted positive cues from gains in most regional peers. The rupee ended at 89.7850 per U.S. dollar, down about 0.1% on the day. Most Asian currencies edged higher but traders said local flow dynamics continued to dominate price action for the rupee, even though it has bounced back from the record-low levels hit last week. The maturity of positions in the NDF market also spurred dollar-buy bids at the daily reference rate, a trader at a Mumbai-based bank said. While price-action in the spot market was largely contained, dollar-rupee forward premiums declined sharply after the Reserve Bank of India announced it will conduct a 3-year $10 billion FX swap next month. The 1-month dollar rupee forward premium fell nearly 15 paisa and the 3-year forward premium was down over 50 paisa. The Japanese yen gained modestly against the U.S. dollar on Wednesday as traders focused on whether weakness in the Japanese currency will prompt officials in the country to intervene. Volumes are light ahead of Thursday’s Christmas Day holiday, when U.S. and many international markets will be closed. The Japanese currency was last up 0.25% on the day against the U.S. dollar at 155.84 per dollar. The dollar reached 157.77 yen on Friday. The dollar was otherwise mixed. The dollar index , which measures it against a basket of other currencies, including the yen and the euro, rose 0.07% to 97.96, with the euro down 0.14% at $1.1778. Sterling weakened 0.13% to $1.3498. The Australian dollar strengthened 0.07% to $0.6705 and the Canadian dollar gained 0.11% to C$1.367 per U.S. dollar. The U.S. currency has fallen this year as the Federal Reserve cuts rates, with more easing expected next year while analysts expect other central banks to have completed their rate reductions. Oil settled marginally lower on Wednesday, and prices were on course for their steepest annual decline since 2020 as investors weighed U.S. economic growth and assessed the risk of supply disruptions from Venezuela and Russia. Brent crude futures closed down 14 cents, or 0.2%, at $62.24 a barrel, while U.S. West Texas Intermediate crude eased 3 cents, or 0.05%, to $58.29

The rupee closed weaker on Friday , pressured by dollar demand linked to maturing non-deliverable forward positions and corporate hedging as global markets awaited a key U.S. Supreme Court ruling on trade tariffs. The currency closed at 90.1625 against the U.S. dollar, down 0.1% on the day but little changed week-on-week. Traders pointed to heightened dollar demand at the central bank's daily reference rate and hedging activity from companies, which weighed on the local unit on Friday. State-run banks were intermittently spotted offering dollars near the day's low for the rupee, which helped limit its losses, two traders said. The central bank stepped in firmly to shore up the currency earlier in the week, but traders said the rupee remains vulnerable without progress in U.S.-India trade talks, or a reversal in portfolio outflows. The dollar gained on Friday after data showed slower than expected U.S. jobs growth, suggesting the Federal Reserve could leave interest rates unchanged later this month. The dollar rose marginally across peer currencies as the data before paring those gains. The greenback was up 0.72% to 158 against the Japanese yen and was up 0.25% to 0.801 against the Swiss franc . The euro was down 0.22% against the dollar at $1.1633. The dollar index rose 0.27% to 99.14. Oil prices rose on Friday on concerns about potential disruption to Iran's output and uncertainty about supply from Venezuela. Brent futures were up 50 cents, or 0.8%, to $62.49 per barrel at 1359 GMT, while U.S. West Texas Intermediate (WTI) crude was up 51 cents, or 0.9%, to $58.27.