Rupee Hits 2025 High Against the Dollar

The Indian rupee briefly touched a 2025 high of 84.97 against the dollar on Friday, closing at 85.24, up 19 paise from the previous day. This surge is attributed to the global weakening of the greenback, with the dollar index down 0.4% at 101.64.

Exporters Feel the Pinch

The strengthening rupee is expected to negatively impact exporters, adding to their existing challenges. Analysts point to weaker crude prices as a supporting factor for the rupee, though the firm dollar index has limited further gains.

Forex Reserves on the Rise

India's forex reserves saw a significant increase, rising by $6.6 billion to $665.4 billion in the week ended March 28. This marks the fourth consecutive weekly rise, with foreign currency assets, the largest component, increasing by $6.2 billion to $565 billion.

Market Reactions and Future Outlook

Investors are bracing for potential volatility as key economic data, including non-farm payroll and unemployment figures, are set to be released. The dollar's recent drop, its steepest since late 2022, has raised concerns over its safe-haven status amid growing economic uncertainties.