Rupee rises 27 paise to 84.96 against U.S. dollar in early trade

Rupee strengthens against dollar on robust foreign fund inflows, domestic data, and easing global tensions, but caution remains.

The rupee appreciated 27 paise to ₹84.96 against the U.S. dollar in early trade on Tuesday (April 29, 2025), supported by robust foreign fund inflows, stronger domestic data, and easing global tensions.

Forex traders said India's manufacturing and industrial production, both expanded by 3%, reflecting the health of domestic demand. Moreover, a strong rally in domestic equities driven by a surge in foreign fund flows further boosted sentiments.

However, caution lingers, as any escalation in tensions between India and Pakistan could swiftly reverse gains and pressurise the rupee, much like past geopolitical episodes, they noted.

At the interbank foreign exchange, the domestic unit opened at ₹85.06 against the greenback, then gained ground and touched ₹84.96, registering a gain of 27 paise over its previous close.

In initial trade, the rupee also touched an early low of ₹85.15 against the greenback.

On Monday (April 28), the rupee appreciated 18 paise to close at ₹85.23 against the U.S. dollar.

"On the global front, a more diplomatic tone has emerged. U.S./ Treasury Secretary Scott Bessent indicated that negotiations with Asian allies, including India and Japan, are progressing well. Importantly, China has shown signs of de-escalation by offering key exemptions on tariffs, signalling a willingness to reduce trade tensions," CR Forex Advisors MD Amit Pabari said.