A day after the budget, the Indian rupee gained momentum, beating the US dollar.

Dollar vs Rupee: A day after the presentation of the Union Budget, the stock market saw a recovery, while the rupee also strengthened. The rupee rose 37 paise to 91.56 per dollar in early trading on Monday. A sharp drop in crude oil prices supported the domestic currency. According to foreign exchange traders, the budget did not provide any immediate relief to the rupee, but the government's policies did provide some reassurance to the market. However, investor sentiment is expected to remain under pressure due to the government's high borrowing plans for the next fiscal year.

Rupee strengthens

The government has projected to borrow around ₹17.2 lakh crore to meet the estimated fiscal deficit of 4.3 percent of GDP in the financial year 2026-27. The rupee opened at 91.95 against the US dollar in the interbank foreign exchange market and gradually strengthened to 91.56 per dollar, a gain of 37 paise over its previous close. Earlier on Friday, the rupee had slipped to a record low of 92.02 against the dollar, though it finally closed at 91.93 per dollar.

Meanwhile, the dollar's position in the global market remained relatively stable. The dollar index, which measures the dollar's strength against six major currencies, rose 0.10 percent to 97.08. Meanwhile, international crude oil prices saw a significant decline, with Brent crude falling 4.14 percent to $66.45 per barrel, providing relief to the currencies of importing countries like India.

Foreign investors raised concerns

However, the activities of foreign investors have also raised some concerns in the market. According to stock market data, foreign institutional investors (FIIs) turned sellers after a long time, selling shares worth approximately ₹588.34 crore. This clearly indicates that while the budget has shown signs of stability returning to the market, foreign investor caution and the government's borrowing plans will play a key role in determining the direction of the rupee and the market in the coming days.