The rupee depreciated 11 paise to 90.77 against the US dollar in early trade on Tuesday as the currency market continues to price in caution rather than celebration, following the India-US interim trade framework.
At the interbank foreign exchange market, the rupee opened at 90.63 against the US dollar, then lost some ground to touch 90.77, registering a loss of 11 paise over its previous close.
On Monday, the rupee witnessed a volatile trading session and settled for the day on a slightly lower note, down 1 paisa at 90.66 against the US dollar.
3 February 2026
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Forex traders said at first glance, the India-US framework looked constructive. It avoided immediate disruptions, set a roadmap for negotiations, and reassured exporters that nothing would break overnight. But as the market dug deeper, the optimism began to fade.
"The agreement places India under ongoing US oversight, particularly around energy imports from Russia — a sensitive issue that leaves room for penalties to be reimposed at any time," CR Forex Advisors MD Amit Pabari said.
In the near term, the 90.00–90.20 zone stands out as a very strong support area. As long as this region holds, USD/INR may gradually drift higher toward 91.00–91.20 in the coming days, Pabari said.
According to Pabari, a key anchor remains the Reserve Bank of India. "On rupee dips, the RBI is expected to step in with dollar purchases, absorbing inflows rather than allowing sharp appreciation," he said.
Meanwhile, foreign investors have shown some improvement. So far this month, FII inflows stand at nearly USD 2 billion in the Indian market.
"While this has helped stabilise sentiment, the market remains unconvinced about the durability of these flows. With global policy signals shifting almost daily, the currency market continues to price in caution rather than celebration," Pabari said.
On Monday, foreign institutional Investors purchased equities worth Rs 2,254.64 crore, according to exchange data.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.02 per cent lower at 97.79.
Brent crude, the global oil benchmark, was trading 0.28 per cent lower at USD 68.85 per barrel in futures trade.
On the domestic equity market front, Sensex rose 149 points to 84,214.75 in early trade, while the Nifty was up 44.45 points to 25,911.75.
