Rupee rises 23 paise to 96.65 against dollar on soft greenback, RBI support
Synopsis
The rupee clawed back 23 paise to 96.65 against the dollar on Friday, driven by a softer US dollar index, cooler crude oil prices, and suspected RBI support — even as FIIs have dumped over ₹36,000 crore in Indian equities this month. The recovery is fragile: it rests on geopolitical calm around Iran and a Fed that stays on pause.
Key Takeaways
The Indian rupee rose 23 paise to 96.65 against the US dollar in early trade on 9 October .
The US dollar index fell toward 102 as Treasury yields declined after a strong 30-year bond auction .
Brent crude eased to around $103 per barrel after President Trump ruled out an Iran attack before the midterm elections.
Markets price an 82 per cent chance of the US Fed holding rates unchanged this month; December hike odds near 81 per cent .
FIIs have net sold ₹36,210 crore in equities through exchanges in October; DIIs bought ₹10,703 crore on Thursday alone.
Sensex opened up 183 points ; Nifty50 opened at 22,314.95 , up 83 points .
The Indian rupee appreciated 23 paise to 96.65 against the US dollar in early trade on Friday, 9 October, buoyed by a softening greenback and suspected intervention by the Reserve Bank of India (RBI). The currency opened at 96.74 at the interbank foreign exchange market before strengthening further to touch the session high.
What Drove the Rupee's Gains
The US dollar index slipped toward the 102 level, extending recent losses as Treasury yields declined following a well-received 30-year bond auction — a signal of sustained investor appetite for long-dated US government debt, according to market experts. Brent crude also eased to around $103 per barrel, easing import-side inflation pressure on the rupee.
A key catalyst was a statement by US President Donald Trump, who indicated that any military action against Iran would come only after the midterm elections, describing ongoing US-Iran discussions as productive. The remark helped cool geopolitical risk premia in oil markets, giving emerging-market currencies including the rupee room to recover.
Fed Rate Outlook Adds a Tailwind
Markets have assigned an 82 per cent probability to the US Federal Reserve holding interest rates unchanged this month, according to analysts. December rate hike odds stood near 81 per cent. Fed Governor Christopher Waller said further tightening would 'likely be needed' to bring inflation back to the 2 per cent target, but stressed that policymakers retained flexibility on the pace of increases. The nuanced guidance was enough to keep the dollar on the back foot.
Previous Session and Institutional Flows
On Thursday, the rupee had depreciated 13 paise, closing at 96.88 against the dollar. Foreign institutional investors (FIIs) offloaded equities worth ₹12,943 crore on Thursday, while domestic institutional investors (DIIs) bought equities worth ₹10,703 crore to partially offset the outflow. FIIs have net sold equities worth ₹36,210 crore through exchanges in October so far — a significant pressure point for the currency.
Equity Markets and the Broader Picture
Indian equity markets opened on a positive note alongside the rupee's gains. The Sensex added 183.43 points, or 0.26 per cent, at the open, while the Nifty50 climbed 83.15 points, or 0.37 per cent, to open at 22,314.95. Buying in IT sector shares supported the broader rally. With FII outflows remaining elevated, how sustained the rupee's recovery proves will likely hinge on the next US inflation print and any fresh signals from the Fed.
Point of View
Neither of which India controls. The deeper signal is the FII exodus: over ₹36,000 crore in net equity sales in October alone is a structural headwind that RBI's suspected intervention can only cushion, not reverse. Until FII flows stabilise, every rupee bounce will remain a relief rally rather than a trend reversal. The Fed's 'flexibility' language from Governor Waller is also a double-edged sword — it caps dollar strength today, but leaves open the door for tighter conditions that would again squeeze emerging-market currencies, including the rupee.
NationPress
9 Oct 2026
Frequently Asked Questions
Why did the rupee appreciate on 9 October?
The rupee rose 23 paise to 96.65 against the US dollar on 9 October due to a combination of a softer US dollar index, easing Brent crude prices, and suspected intervention by the Reserve Bank of India. A statement by US President Trump ruling out an Iran attack before midterm elections also cooled oil market risk, supporting the currency.
What is the current level of FII selling in Indian equities?
Foreign institutional investors have net sold equities worth ₹36,210 crore through exchanges in October so far, according to market data. On Thursday alone, FIIs offloaded ₹12,943 crore, partially offset by DII purchases of ₹10,703 crore.
What did Fed Governor Christopher Waller say about interest rates?
Fed Governor Christopher Waller said further rate increases would likely be needed to bring US inflation back to the 2 per cent target, but stressed that policymakers retained flexibility on the pace of tightening. Markets currently assign an 82 per cent probability to the Fed holding rates unchanged this month.
How did Indian equity markets perform alongside the rupee's gains?
The Sensex opened 183.43 points higher, or 0.26 per cent, while the Nifty50 opened at 22,314.95, up 83.15 points or 0.37 per cent. Buying in IT sector shares provided the primary lift at the open.
What was the rupee's previous closing level?
On Thursday, the rupee had depreciated 13 paise to close at 96.88 against the US dollar, making Friday's 23-paise gain a partial recovery from that session's losses.
