MUMBAI: The rupee closed at 86.95 against the US dollar on Tuesday, slipping 8 paise as demand for {dollars} linked to maturing non-deliverable ahead (NDF) contracts and weak spot amongst regional friends weighed on the foreign money. The benchmark 10-year bond was quoted at Rs.100.7, with the yield at 6.7%, as buyers awaited a debt buy scheduled for later this week.
Last week, the rupee breached the 87 mark for the primary time earlier than staging a pointy restoration, following aggressive intervention by the RBI, which is believed to have offered a number of billion {dollars} to help the foreign money. This intervention is appeared to have restricted additional losses.
The NDF is a cash-settled, foreign money contract the place events agree to change the distinction between a contracted change fee and the market fee on a specified future date, with out the bodily supply of the foreign money.
In addition to pressures from maturing NDF positions, outflows from native shares additionally affected the rupee. Foreign buyers have pulled out round $12 billion from Indian equities in 2025, including to the foreign money’s woes.
Regional weak spot compounded rupee’s troubles because the offshore Chinese yuan slipped 0.2% to 7.3, and the dollar index edged shut to the 107 mark. US bond yields rose, strengthening the dollar, which continued its rebound after President Trump postponed the implementation of reciprocal commerce tariffs.
