USD/INR Forecast
This Week

USD/INR is trading at ₹96.73, near the upper end of last week's ₹96.19–₹97.27 range, with a clear bullish bias. The pair has been supported by persistent dollar demand from importers and a cautious risk tone ahead of key central bank events. Momentum indicators confirm the uptrend: RSI(14) at 72.7 signals overbought conditions but also strong buying pressure, while MACD remains above its signal line and the 20-day EMA sits above the 50-day EMA. The rupee has been weighed down by broad dollar strength and concerns over India's current account deficit, though RBI intervention has likely capped sharper losses. Sentiment remains cautiously bullish for the dollar, but overbought readings suggest the pace of gains may slow as traders await fresh catalysts from the RBI MPC minutes and the US FOMC statement.

This week, three India-specific factors will dominate. First, the RBI MPC minutes on Monday will be scrutinised for the central bank's tolerance for rupee weakness and any hints on intervention levels; a hawkish tone could support the INR, while a dovish stance may embolden bulls. Second, foreign institutional investor (FII) flows remain critical: continued equity outflows would exacerbate rupee depreciation, especially if US yields rise after the FOMC. Third, import demand, particularly for oil, is seasonally strong and adds to the current account deficit, keeping a structural bid under USD/INR. Additionally, the US FOMC statement on Wednesday and jobless claims on Thursday will drive the dollar index, indirectly impacting the rupee. Traders should also watch the US PMI flash on Friday for global risk sentiment.

Immediate support is seen at ₹96.06, a level that has previously attracted buyers and aligns with the lower end of the recent range. A break below this could open the door to ₹95.80–₹95.50, but given the bullish EMA alignment, such a move would likely require a significant shift in sentiment. On the upside, resistance at ₹96.82 is the first hurdle; a sustained break above this level would confirm the bullish bias and target the weekly high of ₹97.27. Beyond that, the psychological ₹97.50 level may come into play. RBI intervention could intensify near ₹97.00–₹97.20, potentially slowing gains. For now, the risk-reward favours buying dips towards support, but overbought RSI warrants caution.

The directional bias for USD/INR this week is bullish, but with overbought RSI, expect choppy trade within the ₹96.19–₹97.27 range. The RBI MPC minutes on Monday could set the tone: any signal of tolerance for a weaker rupee may push the pair towards ₹96.82 and then ₹97.27. However, if the RBI strikes a hawkish note on inflation or intervention, the rupee could strengthen towards ₹96.06. The US FOMC statement on Wednesday is the week's biggest risk event; a hawkish Fed would boost the dollar and likely send USD/INR higher, while a dovish surprise could trigger a correction. Watch US jobless claims on Thursday and PMI flash on Friday for additional volatility. Key levels to monitor: ₹96.82 resistance and ₹96.06 support. A break on either side could define the next directional leg.