Indian rupee opens one paise higher at 88.26/USD ahead of US Fed's rate decision this week

Indian rupee

The Indian rupee opened one paise higher at 88.2612 against the US dollar on September 15 ahead of a widely expected interest rate cut at the US Federal Reserve's policy meeting this week.

Market participants believe the Reserve Bank of India has been intervening to cushion the rupee's weakness, to ensure a orderly move and to avoid a sharper selloff. "The RBI's likely presence is helping to contain the pressure and prevent a bigger shakeout," Reuters quoted a dealer with a state-run lender.

The dollar held steady ahead of a pivotal week filled with central bank decisions led by the Federal Reserve, while the euro hardly reacted to Fitch's downgrade of France's credit rating. The dollar index stood at 97.628 during the morning trade, as against 97.550 at previous close.

The US Fed is widely expected to cut interest rates on September 17 as it grapples with a slowing labor market, sticky inflation and a push by Trump for lower borrowing costs. Trump has been putting pressure for months on Fed Chair Jerome Powell to cut rates and repeatedly encouraged him to resign. The median estimate from a Bloomberg survey of economists is for a 25 basis point rate reduction.

President Donald Trump argued for a “big cut” by the Federal Reserve ahead of a pivotal meeting this week at which the central bank’s governors are expected to ease policy for the first time in nine months, Bloomberg News reported. “I think you have a big cut,” Trump told reporters on Sunday on his way back to Washington. “It’s perfect for cutting.”

So far this year, the Indian Rupee has registered its steepest depreciation since FY23, when it had depreciated by around 7.78 percent. According to Bloomberg data, the Indian rupee depreciated to 88.2787 against the greenback on September 12 from 85.5137 at the start of April 2025, a fall of 2.77 against the greenback.

During FY20, the rupee had depreciated by 8.46 percent against the US dollar.