**INR Brief: Rupee Pauses After Historic Rally** **Market Snapshot** The Indian Rupee (INR) retreated modestly on **Wednesday, February 4, 2026**, ending a volatile session at **90.43** against the US Dollar. This marks a depreciation of **11 paise** from the previous close. The currency fluctuated between an intraday high of **90.26** and a low of **90.54**, driven by renewed demand for dollars from local companies. **Hedging & Consolidation** Importers and corporates moved quickly to hedge their dollar exposures, capitalizing on the rupee’s sharp appreciation from the prior session. Traders also exercised caution, seeking more clarity on the specific framework of the newly announced India-U.S. trade agreement. Weaker-than-expected services PMI data further weighed on sentiment, capping the currency's momentum. **Context: The Tuesday Surge** Wednesday’s pullback follows a historic rally on Tuesday, where the rupee recorded its best single-day gain in over seven years. It surged approximately **1.3%** (122 paise) to settle around **90.27**, fuelled by the breakthrough trade deal with the United States. The agreement, which slashes reciprocal tariffs on Indian goods to **18%**, is expected to boost export competitiveness and attract foreign inflows. **External Factors** Broader market conditions remain mixed. The Dollar Index (DXY) softened to **97.57**, providing some underlying support. However, geopolitical tensions and fluctuating crude oil prices—with Brent trading near **$66.18** per barrel—continue to influence the currency’s near-term trajectory.