USD/INR bounces modestly from recent lows, advancing slightly to the 89.80 zone during the holiday-thinned session on December 28. This stabilization follows RBI interventions that halted sharp depreciation earlier in the month, driven primarily by heavy FII outflows and dollar demand pressures.
The pair’s mild recovery reflects a pause in aggressive selling, as the Indian Rupee finds temporary support after touching highs near 91 earlier in December—the weakest levels on record amid persistent foreign portfolio exits exceeding ₹1.58 lakh crore for 2025. RBI’s decisive dollar sales and liquidity measures successfully capped extreme volatility, allowing limited rebound in low-volume trading conditions.
Traders note reduced downside momentum, with the bounce aligning to technical supports and diminished speculative pressure during year-end lulls. While structural challenges—including trade uncertainties and capital flow reversals—remain, the intervention’s effectiveness signals RBI’s commitment to orderly markets, fostering short-term stabilization.
Forex participants monitor USD/INR for versatile setups, with longs on confirmed dips offering reward in stabilized conditions and shorts on failed rallies targeting deeper corrections. Holiday liquidity warrants caution, yet the underlying bias leans toward range-bound action pending fresh catalysts into 2026.
As USD/INR bounces from recent lows to the 89.80 zone on December 28 amid holiday-thinned trading, it reflects stabilization after RBI actions countered sharp depreciation from FII outflows. This phase positions the pair for potential directional clarity as normal volumes resume in the new year.
