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The rupee depreciated 22 paise to 90.54 against the U.S. dollar in early trade on Wednesday (February 4, 2026), following a sharp rally after India and the U.S. agreed to a trade deal on suspected dollar buying by corporates and importers.
Forex traders said despite the positive sentiment post the India-U.S. trade deal, caution still remains as there is no signed or officially released trade agreement yet — no framework text or final documentation.
At the interbank foreign exchange market, the rupee opened at 90.35 against the U.S. dollar, then lost ground and fell to 90.54, registering a loss of 22 paise over its previous close.
On Tuesday (February 3, 2026), the Indian rupee emerged as the best-performing Asian currency, registering a record gain of 117 paise or 1.28 per cent in a single trading session to settle at 90.32 against the U.S. dollar, after India and the U.S. agreed to a trade deal.
“After Tuesday’s good news the rupee was back to its own self of weakening as RBI bought dollars towards the end to take the dollar up to 90.2650,” said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
Forex traders said investors are trading with caution as the India-U.S. trade deal still awaits formalisation.
“Any sustained turnaround in FII flows will depend on greater clarity around the final structure and commitments within the deal,” CR Forex Advisors MD – Amit Pabari said.
President Trump stated that India will end purchases of Russian crude over an undefined timeline, while increasing imports of U.S. energy, including oil and coal, and potentially Venezuelan crude with U.S. approval.
“Moving away from discounted Russian oil could prove challenging for India, given its long-standing commercial and strategic ties with Moscow, and may have implications for India’s energy costs and external balance,” Mr. Pabari added.
According to Mr. Pabari, the 89.80–90.00 zone should act as strong support. “Ultimately, the directional cue for the rupee will hinge on confirmation of the final trade agreement and its specifics. That clarity will determine whether this move extends — or pauses for consolidation,” he said.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.02 per cent lower at 97.41.
Brent crude, the global oil benchmark, was trading higher by 0.65% at $67.77 per barrel in futures trade.
On the domestic equity market front, Sensex advanced 68.49 points to 83,816.96 in early trade, while the Nifty was up 51.90 points to 25,779.45.
Foreign Institutional Investors purchased equities worth ₹5,236.28 crore on Tuesday 9February 3, 2026), according to exchange data.
Published – February 04, 2026 11:00 am IST
