The USD/INR pair edged lower on Wednesday as market participants adopted a cautious stance ahead of Donald Trump’s inauguration as the 45th President of the United States. The Indian rupee strengthened slightly, supported by muted dollar demand and a balanced risk sentiment in global markets.
The US dollar faced mild selling pressure, with traders awaiting further clarity on Trump’s economic policies and potential shifts in trade relations. Meanwhile, the Reserve Bank of India’s (RBI) apparent intervention helped limit volatility in the currency pair, providing additional support to the rupee.
Analysts noted that India’s stable macroeconomic conditions, coupled with easing crude oil prices, contributed to the rupee’s resilience. However, market sentiment remained cautious as global investors assessed the broader implications of Trump’s policies on emerging markets.
Looking ahead, the USD/INR trajectory is likely to be influenced by Trump’s first official actions and their impact on global trade and risk appetite. Traders will also focus on upcoming US economic data and RBI’s stance on currency management for further cues
