Indian Rupee Finished The Day at 91.9550

The Indian rupee closed at 91.9550 on Thursday in comparison to its previous closing at 91.7825 on Wednesday evening. The USDINR pair has pulled back slightly to around 92.00 (with current levels near 91.90–92.00 as of January 29, 2026) after reaching a fresh all-time high of 92.19 on January 28, following over 0.5% gains in the prior session. The Indian Rupee strengthened modestly amid speculation of Reserve Bank of India (RBI) intervention to curb excessive weakness, despite pressures from broad Asian currency softness, dollar demand due to maturing non-deliverable forward (NDF) positions, month-end importer buying, and a reaffirmed US commitment to a strong dollar policy by Treasury Secretary Scott Bessent. This came despite the US Dollar Index (DXY) easing to around 96.10 after earlier gains, supported by the Federal Reserve's decision to hold rates steady amid resilient growth and elevated inflation, though tempered by market anticipation of potential future rate cuts and speculation around a new Fed Chair nominee. Positive developments like the India–EU trade deal (reducing tariffs on Indian exports and EU cars) and possible US removal of punitive tariffs on India for Russian oil purchases offered some support to the Rupee, but the pair maintains a bullish bias within an ascending channel on the daily chart, with overbought RSI signaling potential near-term consolidation or pullback risks toward supports like 91.60 or 91.48.

At close, the Sensex was up 221.69 points or 0.27 percent at 82,566.37, and the Nifty was up 76.15 points or 0.30 percent at 25,418.90. L&T, Tata Steel, Eternal, Axis Bank, Tata Motors Passenger Vehicles were among top gainers on the Nifty, while losers were Asian Paints, SBI Life Insurance, Interglobe Aviation, Maruti Suzuki and Tata Consumer.

The Economic Survey 2025-26 highlights that domestic institutional investors (DIIs), especially mutual funds and insurance companies, have acted as a major stabilizing force for Indian equities amid ongoing net selling by foreign institutional investors (FIIs). FIIs have remained net sellers since July 2025 (except for October and November), including outflows of ?36,771.10 crore in January 2026 so far, while DIIs have consistently bought throughout the year, purchasing ?67,183.01 crore worth of shares in January alone. This domestic support has helped cushion market volatility, with DII holdings surpassing FIIs for the first time in Q4 FY25 and reaching an all-time high of 18.3% in Q2 FY26 (compared to FIIs' 16.7%, a 13-year low). Mutual funds' share hit a record 10.9%, and the combined holdings of DIIs, retail investors, and high-net-worth individuals peaked at 27.8%. Although Indian equities (MSCI India up 8.13% in 2026 so far) have delivered solid but no longer leading returns relative to surging North Asian markets like Korea (92.41%), Taiwan (30.49%), and China (28.31%), the growing domestic participation—bolstered by retail and mutual fund flows—has reduced reliance on foreign capital and provided a strong counterbalance to global pressures.