INR vs USD: Indian rupee weakens past 96 against US dollar for the first time in 7 days; check key factors

Investing.com data showed that the Indian rupee weakened 0.20% to touch a high of 96.388 against the US dollar, in comparison to 96.187 at the previous currency market close.

As of 9:33 am (IST), the INR was trading near their day-high levels at 96.366 against the benchmark US greenback as global investors power the demand for the global currency amid the rising uncertainty in the market.

The Indian currency surpassed the 96 per dollar level on Tuesday’s market for the first time in seven days, since September 17, 2026.

Exchange data also showed that the Indian rupee has weakened 0.8% against the dollar in the past one week, around 1% in the past month, and nearly 2% in the last three months due to the elevated risk and volatile sentiment in the market.

What’s impacting INR rates today?

The Indian rupee rate was impacted during the trading session on Tuesday, September 29, as investors focused on the multi-year high US Treasury yields, which increased the demand for the dollar in the market amid no signs of a peace deal in West Asia.

After Trump’s peace proposal rejection and indication that any potential move will be post the US mid-term elections, investors remained cautious as the situation in West Asia remains critical despite being in the 7th month of the conflict.

Data showed that the benchmark US 10-year Treasury yields surged to a multi-year high of 5.25% as of 12:23 am (ET) in the United States.

Market experts said that the US dollar remained near its two-month high levels as expectations are around a further rate hike from the US Federal Reserve to counter the energy-linked inflation risk in the economy.

Hence, higher expectations of a potential rate hike at the next US Fed meeting add to the demand for safe-haven assets like US Treasuries, which in turn increases dollar demand at a time when global investors continue to face geopolitical uncertainty due to the West Asia crisis.

This increase in demand for the global currency impacts sentiment for emerging market assets like the Indian rupee, as investors tend to pull their money out of riskier bets into the safe-haven dollar.

Data also showed that the US dollar spot index surged to an intraday high of 101.29 during the trading session as of 9:47 am, India time, indicating heavy interest from currency market investors.