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USD/INR seen range-bound as RBI holds policy rate at 5.25%
Commerzbank analysts expect USD/INR to drift gradually lower, with forecasts targeting about 93.2 by December 2027, aided by FX reserves above USD 700 billion.
Commerzbank FX analysts Charlie Lay and Moses Lim expect USD/INR to remain broadly stable as the Reserve Bank of India keeps the policy repo rate at 5.25% and stays in wait-and-see mode, according to FXStreet.
They note the pair has traded between 94.00 and 97.00 since May, and they project a gradual drift lower toward 93.2 by December 2027. The view is supported by strong FX reserves and earlier USD deposit inflows that have helped bolster INR, the analysts said.
The outlook also cites India’s growth resilience and stable inflation, with Commerzbank pointing to RBI projections of 6.7% expansion for fiscal 2026 to 2027 versus 8.0% in the prior fiscal year, and an inflation forecast of 5% within the central bank’s 2% to 6% target band.
Commerzbank adds that RBI efforts to attract foreign capital and stabilize the rupee have been effective, including closing the FCNR(B) deposit scheme one month early on 31 August. The analysts also flag INR sensitivity to higher global crude oil and gold prices and say RBI could use spot and forward FX intervention if pressures return.
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