Indian Rupee Expected to Trade with Depreciating Bias in Near Term

The Indian rupee (INR) is anticipated to trade with a depreciating bias in the near term, with the United States-dollar/Indian rupee (USD/INR) rate expected to trade in the range of 89–90 per dollar this month, a recent report from Bank of Baroda revealed.

Key Drivers of Currency Movement

• US-India Trade Deal: Progress on a United States-India trade deal will be the main catalyst for any sharp move of INR either way, as per the Bank of Baroda report.
• RBI Rate Decision: The report suggests that the RBI will not cut rates this meeting, as the rate cut by the US Fed has been fully priced in by the markets.
• US Fed Decision: The US Fed decision and RBI MPC outcome are unlikely to have a significant impact on the currency, as the rate differential will be maintained.

Recent Economic Data

The INR eased 0.8 per cent in November 2025 to close at 89.46 despite a surprisingly strong GDP print. The bank noted that the softening in INR was more pronounced when considering the fact that the dollar weakened in the same period.

• July-September Quarter GDP Growth: The GDP growth came in at 8.2 per cent YoY, higher than 7.8 per cent in the previous quarter and higher than the estimates from economists of 7.5 per cent.
• GVA Growth: GVA growth came in at 8.1 per cent, while nominal GDP grew 8.7 per cent.

Updated GDP Growth Forecast

Crisil Limited revised India's GDP growth forecast for the current fiscal year to 7 per cent, up from its earlier estimate of 6.5 per cent.

US Fed Rate Cut Expectations

Markets have readjusted their expectations of a US Fed rate cut, with the CME FedWatch now projecting the probability of a rate cut in December at close to 90 per cent.

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