The Australian dollar (AUD) is currently performing robustly against the Indian rupee (INR), trading at 59.70 INR, which is 2.7% higher than its three-month average of 58.11. This increase is attributed to a combination of factors, including a favorable market sentiment and a prevailing risk-on mood that has been bolstering the AUD.
Analysts observe that the AUD's strength is underpinned by recent economic data, particularly a notable surge in household spending of 1.3% in October 2025, and the fastest annual economic growth in two years, marking a yearly GDP increase of 2.1% in Q3 2025. These developments have heightened expectations for potential interest rate hikes by the Reserve Bank of Australia (RBA), as persistent inflation concerns, rising to 3.8% year-on-year, complicitly shift market sentiment from anticipating rate cuts to speculating on tightening measures.
On the opposite end, the Indian rupee is facing significant pressures. The INR has reached a historical low of 90.42 per U.S. dollar, impacted by a widening trade deficit exacerbated by increased tariffs on Indian exports. Additionally, substantial foreign investment outflows, with nearly $17 billion pulled from Indian equities in 2025, continue to detrimentally affect the rupee's value. The Reserve Bank of India's recent policy shift to tolerate a weaker rupee amidst these challenges has further underscored a bearish outlook for the currency.
Forecasters note that the current trajectories raise concerns for the INR, especially as predictions suggest it could further depreciate to 92 against the U.S. dollar without prompt action on trade issues. As global markets continue to respond to domestic economic indicators, both the AUD and INR are likely to remain affected by emerging data and geopolitical dynamics. The ongoing performance indicates that those involved in international transactions should monitor these trends closely, as favorable exchange conditions for the AUD may present cost-effective opportunities against the INR.
