Stock Market · Currency, Commodity & GSec

Currency markets

The Indian Rupee (INR) versus the US Dollar (USD) is the most important currency pair for Indian investors. It affects your stocks, your imports, your fuel prices, and your mutual fund returns.

How the forex market works

Currencies trade 24 hours a day, 5 days a week, across global financial centres. The forex market is the largest in the world, over $7 trillion per day in trading volume.

In India, the Rupee trades on NSE and BSE via currency futures and options. The Indian forex market operates 9 AM to 5 PM.

Why USD/INR matters

• India imports over 80% of its crude oil, priced in USD.
• A weak Rupee = costlier crude = higher petrol prices = inflation.
• IT companies earn in USD and report in INR. A weak Rupee boosts their INR revenue.
• FIIs (foreign investors) who buy Indian stocks bring in USD. If they sell and take money out, the Rupee weakens.

> When the Rupee depreciates, it's not just your travel that gets expensive. It affects corporate earnings, inflation, RBI policy, and ultimately stock prices.

Historical context

About ₹3.3 = $1 at Indian independence in 1947 (the rupee was pegged to the British pound), and about ₹18 = $1 just before the 1991 crisis.

₹15 = $1 in 1991 (balance of payments crisis).

₹85+ = $1 in 2025.

The Rupee has depreciated over decades due to higher inflation in India vs the US.

Stronger Rupeegood for importers (oil, electronics, pharma raw materials)

Weaker Rupeegood for exporters (IT, textiles, pharma finished goods)

Takeaway. USD/INR is the most impactful currency pair for India. A weaker Rupee raises import costs, drives inflation, and boosts IT company revenues. Every Indian investor should watch USD/INR as a macro indicator.