Oil, foreign flows in focus for rupee; bond traders eye rate-hike bets
Benchmarks Nifty23,146.15148.81FEATURED FUNDS★★★★★UTI Aggressive Hybrid Fund Regular Plan-Growth5Y Return8.8 % Invest NowFEATURED FUNDS★★★★★Motilal Oswal Midcap Fund Direct-Growth5Y Return18.64 % Invest NowEnter search…
Oil, foreign flows in focus for rupee; bond traders eye rate-hike bets
Oil, foreign flows in focus for rupee; bond traders eye rate-hike bets
ReutersLast Updated: Oct 19, 2026, 08:28:00 AM ISTSynopsisDuring the upcoming holiday week, analysts predict the Indian rupee will remain steady, with oil price trends and foreign capital flows playing essential roles. Impressively, the rupee rose by 2% last week, achieving its highest value since March at 94.96. The Reserve Bank of India is undertaking assorted measures aimed at strengthening the rupee while addressing inflation worries.
The Indian rupee is likely to be steady over a holiday-truncated week, with oil prices and foreign portfolio flows in focus, while bond yields could face headwinds from tightening banking system liquidity and growing bets on aggressive rate hikes.Last week, the rupee posted its best week since March with a 2% gain as the central bank rolled out a series of measures to shore up the local unit. It ended at 94.96 on Friday.
The Reserve Bank of India has made it costlier for importers to hedge future current-account payments, raised the cost for banks of buying foreign currency for certain transactions, and opened a dedicated window to supply state-run oil companies with dollars directly from its foreign-exchange reserves.
Bonds Corner Powered By
Oil, foreign flows in focus for rupee; bond traders eye rate-hike bets
During the upcoming holiday week, analysts predict the Indian rupee will remain steady, with oil price trends and foreign capital flows playing essential roles. Impressively, the rupee rose by 2% last week, achieving its highest value since March at 94.96. The Reserve Bank of India is undertaking assorted measures aimed at strengthening the rupee while addressing inflation worries.
YES Bank book value may fall up to 26% after SC ruling on AT-1 bondsAggressive RBI measures hand India bonds a ninth weekly lossIndian bonds hang tight ahead of supplyKotak MF suspends subscriptions in two debt funds holding Yes Bank AT1 bonds Browse all Bonds News withThe combined impact of these measures, expectations of further steps and the central bank's market interventions is expected to support the rupee. Traders see the currency in a 94-95.50 range in the near term.
Indian financial markets will be shut on Tuesday for a local holiday, while investor focus will broadly remain on developments in the Middle East and how they affect oil prices and foreign portfolio flows into Indian assets.
Live Events
Brent crude prices touched $110 a barrel for the first time since May on Friday. Jitters about global investments in AI firms are also expected to ripple through the FX market, impacting equity or debt flows.
"Heavily overweight positioning leaves the USD vulnerable to a reversal when sentiment towards AI deteriorates," MUFG said in a note.
BONDS
Indian government bonds could continue facing mild selling pressure as fears of a larger rate hike weigh on investor sentiment.Traders expect the benchmark 10-year yield to move in the 7.32% to 7.42% range, with an eye on oil prices and any more steps from the central bank.
India's benchmark 10-year bond yield posted its ninth consecutive weekly rise, ending at 7.3789% on Friday, up 8 basis points for the week. It had risen 54 basis points over the previous eight weeks, extending its longest-ever run of weekly increases, according to LSEG-compiled data.
Sentiment has been negative since the central bank raised policy repo rate and changed stance, followed by hawkish commentary from Governor Sanjay Malhotra in a media interview.
"We would not characterise the RBI as significantly behind the curve, but inflation risks remain tilted to the upside. A cumulative 100 bps of tightening by June would help the RBI stay ahead of emerging price pressures while preserving its inflation-fighting credibility," said Krishna Bhimavarapu, Asia-Pacific economist at State Street Investment Management.
After the central bank's commentary, calls for a 50-bps move in December have risen, with the central bank expected to use the interest rate as a defence mechanism to protect the local currency.
Meanwhile, foreign investors will continue to remain cautious after being sellers for last few days.
"India cannot fully decouple from elevated developed-market yields, oil prices and global risk sentiment. Higher global yields affect the relative attractiveness of Indian assets, while higher oil prices and INR depreciation can feed into imported inflation," said Norbert Ling, Head of Fixed Income Portfolio Management, APAC at Invesco.
Add as a Reliable and Trusted News Source Add Now!
(You can now subscribe to our ETMarkets WhatsApp channel)
Read More News onoil prices impactRBI rate hikesIndian rupee predictionbond market trends
(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
...moreless(You can now subscribe to our ETMarkets WhatsApp channel)
Read More News onoil prices impactRBI rate hikesIndian rupee predictionbond market trends
(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
...morelessPrime ExclusivesInvestment IdeasStock Report PlusePaperWealth EditionBusiness of Odd Things: Inside an industry that farms fish that nobody is meant to eat
War's second-order effects are becoming visible in critical sectors
US mid-term elections – Part 2: What does it mean for Trump to lose control of Congress?
Homebuyers wait as NCLT panel picks holes in unfinished Jaypee projects
What is the real impact of 13x jump in cash transfers to women?
Airlines Q2 turbulence: Fewer passengers, rising fares and a crude shock
- 1
- 2
- 3
& personalised newslettersLogin NowUnlimited AccessStarting @ Rs120/monthGet access to exclusive stories, expert opinions &
in-depth stock reportsSubscribe NowET
Unlock Access to All Exclusives with ETPrime FREE TRIAL
15 Days Free: Unlock All ETPrime Exclusives, Market Tools & ePapers
Trial offer expiring in00 : 05 : 00
I'd rather pay ₹2599 nowUh-oh! This is an exclusive story available for selected readers only.
Worry not. You’re just a step away.
Prime Account Detected!
It seems like you're already an ETPrime member with
Login using your ET Prime credentials to enjoy all member benefits
Log out of your current logged-in account and log in again using your ET Prime credentials to enjoy all member benefits.
Unlock ETPrime's Exclusive Stories Today!
Big Price Drop! Flat 40% Off
Student Only OfferAlready a Member? Sign In nowAlready a Member? Sign In nowAlready a Member? Sign In nowOffer Exclusively For You
Save up to Rs. 700/-
ON ET PRIME MEMBERSHIP
Avail OfferOffer Exclusively For You
Get 1 Year Free
With 1 and 2-Year ET prime membership
Avail OfferOffer Exclusively For You
Get 1 Year Free
With 1 and 2-Year ET prime membership
Avail OfferOffer Exclusively For You
Get Flat 40% Off
Then ₹ 1749 for 1 year
Avail OfferOffer Exclusively For You
ET Prime at ₹ 49 for 1 month
Then ₹ 1749 for 1 year
Avail OfferSpecial Offer
Get flat 40% off on ETPrime
Avail OfferAvail OfferClaim NowAlready a Member? Sign In nowNeed Assistance?
Connect with an ETPrime expert for personalized support and guidance
+91 9484700004'; }); } if(listing) { var h3 = "You tried reading " + listArr.length + " locked stories in the past " + threshold + " days.", h4 = "Become an ET Prime member and don't miss out on these exclusive stories."; var html = '' + h3 + '
' + h4 + '
- ' + listing + '
What’s Included with
ETPrime Membership
1Exclusive Insights That Matter
Uncover the truth with our investigative stories
Make strategic moves using the real-world case studies
Read industry-specific stories to identify emerging trends
Spot opportunities with in-depth insights that matter
Trump temper on H-1B visas is forcing Indians to do these things to stay put in US
What Adani’s US indictment means for India Inc’s overseas fundraising
Why veterans like Reliance, L&T are on acquisition spree? Aswath Damodaran has an answer.
Will China’s dollar bond sale in Saudi Arabia trump the US in financial world?
Huawei launches its own OS to compete with Google and Apple. But can it win beyond China?
The problem with lab grown diamonds
Why a falling rupee is a better option for the economy
A list of top 20 momentum stocks that have delivered massive returns in one year
2Invest Wisely With Smart Market Tools & Investment Ideas
Alpha Trade
Get daily trade ideas from SEBI-registered research analysts.
Investment Ideas
Grow your wealth with stock ideas & sectoral trends.
Stock Reports Plus
All-in-one stock research with Stock Score, peer comparison & key signals.
BigBull Portfolio
Get to know where the market bulls are investing to identify the right stocks.
Stock Analyzer
Check the score based on the company's fundamentals, solvency, growth, risk & ownership to decide the right stocks.
Market Mood
Analyze the market sentiments & identify the trend reversal for strategic decisions.
Stock Talk Live at 9 AM Daily
Ask your stock queries & get assured replies by ET appointed, SEBI registered experts.
3Stay informed anytime, anywhere with ET ePaper
ePaper - Print View
Read the PDF version of ET newspaper. Download & access it offline anytime.
ePaper - Digital View
Read your daily newspaper in Digital View & get it delivered to your inbox everyday.
Wealth Edition
Manage your money efficiently with this weekly money management guide.
TOI ePaper
Read the PDF version of TOI newspaper. Download & access it offline anytime.
Deep Explainers
Explore the In-depth explanation of complex topics for everyday life decisions.
Health+ Stories
Get fitter with daily health insights committed to your well-being.
Personal Finance+ Stories
Manage your wealth better with in-depth insights & updates on finance.
5Enjoy Complimentary Subscriptions From Top Brands
Stream new documentaries from all across the world every day.
Stories you might be interested in
Figures reflect the source report and its stated period. This article is for information and is not investment advice.
