Rupee Gains 16 Paise to Close at 85.39 Against US Dollar

The Indian rupee strengthened by 16 paise to close at 85.39 against the US dollar on Monday, buoyed by a weaker US currency and market expectations of a rate cut by the Reserve Bank of India (RBI).

Forex traders attributed the rupee’s gain to the anticipation that RBI’s Monetary Policy Committee (MPC) might ease key interest rates during its upcoming meeting, which begins on June 4, with the decision scheduled for announcement on June 6.

However, the local currency’s upside was capped by volatility in equity markets, continued foreign fund outflows, and rising crude oil prices. These factors limited sharper gains despite the supportive environment for the rupee.

Market participants will closely watch the RBI’s policy outcome for further cues on the rupee’s trajectory in the near term.