FX – WEEKLY UPDATE :

Weekly SYNOPSIS: 12/06/2026

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Currency Map:

Currency Pairs	WEEK  CLOSE	PRIOR WEEK CLOSE	% change
USD/INR	95.10	94.94	0.16
EUR/INR	110.36	110.83	-0.42
GBP/INR	127.83	128.10	-0.21
JPY/INR	59.50	59.64	-0.41

Brent Crude closed at USD 87.50 VS previous week close of USD 93. Gold closed at USD 4219. Nifty closed at 23623 vs prior week close of 23366. 10 Year G-SEC Yield is now at 6.86%.

Major developments: USDINR traded in the 94.94-95.76 range last week, and Rupee declined 0.16% w/w against USD. Rupee had a two way swing in the 94.95-95.80 zone. EUR declined 0.42% w/w and GBP declined 0.21% w/w against Rupee. USDINR fwd premia closed at 2.81% for 1 year.

Indian benchmark Equity indices climbed 1.10% w/w. 10 Year G-SEC Yield closed at 6.86%.

FX reserves stood at USD 61.60 bn, as on June 5 th. Reserves declined USD 711 mn w/w.

In June, FII’S have sold Rs 40903 Cr of Indian Equities and have bought Rs 3350 cr of debt.

Rupee gained to 94.95 as US President said that weekend deal with Iran is imminent and war is coming to an end and shipping lanes will reopen shortly. Upside break of 95.80 is required to trigger next wave of Rupee decline.. However with Banks raising FCNR deposits, supported by RBI, there is hope for Rupee gain or consolidation. Big Spot gains may not come through as RBI may keep covering their short positions estimated at around USD 120 bn. If geo political tensions fade and OIL prices decline in a sustainable manner, FII’s could return and this could also help Rupee. Govt has scrapped all taxes for FII investment in G-SEC’S retrospectively from April 1 st 2026. Indian Equity index steamed higher on positive developments.

May CPI climbed 3.93% as against 3.48% in April. Food inflation climbed to 4.78% in May as against 4.2% in April. Core inflation climbed 3.73%.

Technically, USDINR has supports at 94.75/94.50 levels.

Hedging advise: Hedging be done according to policy objectives.

Global developments: US President Donald Trump on Thursday said a deal had been reached with Iran and that a final document could be signed in Europe soon, perhaps even over the weekend. He also said the Strait of Hormuz would reopen immediately upon the signing, and that an ongoing U.S. naval blockade of Iran’s ports and coastline would be removed.

Oil markets have aggressively dismantled geopolitical risk premium as traders anticipate a return of Iranian supply and normalization of shipping through Hormuz. FX markets remain muted, waiting for the final deal. Deal would include lifting sanctions on Iranian Oil, unfreezing of Iranian assets, end to hostilities on all fronts and reopening of Hormuz straits.

US Headline inflation accelerated to the fastest pace in three years – 4.2% year-on-year. Core inflation also remained high at 2.9%, above Fed’s comfort levels.US PPI surged to its highest annual rate since 2022, while core producer inflation recorded its strongest monthly increase in more than three years.

ECB hiked rates by 25 bps. Inflation forecasts were revised higher, growth forecasts were revised lower, and policymakers explicitly warned that the Middle East war is generating inflation pressures across the Eurozone. After ECB’S last week rate hike, Bundesbank President Joachim Nagel reinforced the hawkish message. Warning that the Middle East energy shock is proving “strong and persistent,” he made clear that another rate increase in July cannot be ruled out if inflation pressures continue to spread.

FOMC meeting and MPC meetings, US retail sales are important economic events for the week.

Currency technical levels: USDINR: 94.75/94.50(support) , (Resistance) 95.80

EURINR:110(Support),  (Resistance): 112.75

GBPINR: Supports: 127(supports), Resistance:130.40

JPYINR: Resistance:60.35/61.30 Supports: 59.45 (support).