The Indian rupee ended its week-long losing streak on Friday, September 18, recovering slightly against the US dollar as active dollar sales by the Reserve Bank of India (RBI) and a moderation in crude oil prices provided some relief to the domestic currency.

The rupee closed at ₹95.87 per US dollar, compared with the previous close of ₹95.93. During the session, the currency traded between approximately ₹95.70 and ₹95.91. However, a stronger US dollar and continued demand for dollars from importers limited the rupee's gains.

RBI Intervention Supports Rupee

Market participants reported that the RBI was actively selling dollars in the foreign exchange market as the rupee approached the ₹96-per-dollar level. Reuters reported that traders viewed the ₹96 level as an important threshold, with central-bank intervention helping limit further depreciation.

Despite Friday's recovery, the rupee remained under pressure during the week and recorded a 0.3% weekly decline. It has also weakened around 1.05% so far in the current financial year, according to The Economic Times.

Crude Oil Prices Provide Some Relief

A decline in crude oil prices also helped the rupee. Brent crude briefly moved down towards $101 per barrel on Friday after rising sharply earlier in the week amid tensions in the Middle East.

Lower crude prices are important for India because the country depends heavily on imported oil. A sustained decline in oil prices can reduce pressure on India's import bill and foreign-exchange demand.

Strong Dollar Remains a Challenge

The rupee's recovery remained limited because the US dollar continued to trade strongly. The dollar index was around 101.3, while demand for US currency from importers also kept pressure on the Indian currency.

Global interest-rate developments are another factor investors are watching. The US Federal Reserve and Bank of Japan raised interest rates during the week, adding to concerns about tighter global financial conditions and their impact on emerging-market currencies.

What Investors Are Watching

For the rupee, the key factors in the near term include crude oil prices, global interest rates, foreign capital flows and RBI intervention. The successful subscription of the $2.3 billion NSE IPO also brought attention to potential foreign and domestic capital flows that could support the currency.

The rupee's Friday recovery therefore offered some relief after a difficult week, but currency markets remain sensitive to movements in oil prices, the US dollar and global monetary policy.