Recent forecasts for the USD to INR exchange rate indicate a complex interplay of influences driving both currencies. The US dollar has strengthened recently, benefiting from a cautious trade environment as investors seek safe-haven assets. This trend was reinforced by hawkish signals from the Federal Reserve, as noted in the latest meeting minutes, suggesting potential interest rate stability in the face of upcoming economic data. Analysts are closely monitoring the September non-farm payroll report, as weaker outcomes could revive discussions around a Fed rate cut, impacting the dollar's strength.
On the Indian side, the rupee has faced considerable pressure, recently hitting an all-time low against the dollar at 88.62 in late September 2025. This decline has been attributed to several factors including increased US visa fees, reduced foreign investment inflows, and sustained demand for dollars from importers. The Reserve Bank of India's intervention strategies, including expanding dollar forward positions, reflect efforts to stabilize the rupee, yet ongoing challenges remain. The narrowing policy rate differential between the US and India, combined with weak manufacturing export growth, further complicates the rupee's outlook.
Market participants have noted that the USD to INR pair is currently trading near 88.46, at 14-day lows but remains within a stable range of 87.02 to 88.87 over the past three months. Experts anticipate that ongoing developments, both in the US regarding inflation and Federal Reserve policies, as well as India's economic indicators and central bank actions, will significantly influence the USD to INR exchange rate in the near term.
