In relation to the US dollar, the Indian rupee opens flat at 85.64.

Despite the easing dollar index, the Indian rupee opened flat against the US dollar at 85.64. Since the dollar index, which gauges the strength of the US dollar relative to a basket of six major currencies, fell precipitously to 99.621 from 100.118 at the previous close, currency experts predict that the local currency may weaken during today's trading session. Following worries about the US economy and fiscal outlook, the dollar index decreased. In response to Moody's recent downgrade of the US government's credit rating, US Federal Reserve officials took a cautious stance, avoiding political commentary while acknowledging the possible impact on economic conditions. In the midst of geopolitical unrest, oil companies purchased dollars to replenish strategic reserves, causing the local currency to plummet by about 24 paise on May 20. Despite the easing of the dollar index, which fell from 100.118 to 99.621, the Indian rupee opened flat at 85.64 against the US dollar on May 21, 2025. This decrease in the dollar index, which measures the strength of the US dollar against a basket of six major currencies, is largely attributed to concerns about the US economy and fiscal outlook. The US Federal Reserve has taken a cautious stance in response to Moody's recent downgrade of the US government's credit rating, which has further weighed on market sentiment. Experts predict that the Indian rupee may weaken during today’s trading session due to these global economic pressures. The dollar index's fall reflects broader worries about the fiscal health of the United States, as the downgrade highlights increasing debt levels and potential economic instability. The downgrade by Moody’s from AAA to Aa1 underscores the challenges facing the US economy, including high national debt and rising interest payments. These concerns have caused fluctuations in the global currency markets, leading to a weakening of the US dollar, which has had a direct impact on emerging market currencies like the Indian rupee. In addition to the economic concerns surrounding the US, the geopolitical situation has also played a role in the rupee’s performance. Oil companies have been purchasing US dollars to replenish their strategic reserves, which has put additional pressure on the Indian rupee. On May 20, 2025, the rupee plummeted by about 24 paise, closing at 85.58 against the dollar, due to these dollar purchases in the midst of ongoing geopolitical unrest. This situation has added to the volatility in the forex market, creating further uncertainty for the Indian rupee's future trajectory. Given the continued global and local economic factors at play, including the ongoing concerns over the US economy and the impact of oil reserves replenishment, experts believe that the Indian rupee may face further challenges in the coming days. Market participants are closely monitoring these developments, with many anticipating a possible weakening of the rupee as the trading session progresses. The forex market remains volatile, and the rupee’s movement will largely depend on how these global factors continue to evolve.