**Market Brief: Rupee Posts Historic Single-Day Gain** **Date:** February 3, 2026 **Topic:** currency Markets / USDINR The Indian Rupee (INR) staged a massive rally on Tuesday, recording its **best single-day performance since December 2018**. The domestic currency appreciated by **122 paise** (approx. 1.33%) to settle at **90.27** against the US Dollar, recovering sharply from recent lifetime lows. **Key Drivers:** * **US-India Trade Breakthrough:** Market sentiment soared after the US and India announced a landmark trade agreement. * **Tariff Cuts:** The US has slashed reciprocal tariffs on Indian goods from **50% to 18%**, significantly boosting export competitiveness. * **Strategic Shifts:** As part of the deal, India has agreed to strategic shifts in energy procurement, reducing reliance on Russian oil in favor of US energy and technology products. **Market Action:** * **Price Action:** The rupee opened at **90.30**, touched an intraday high of **90.05**, and settled at **90.27**. * **RBI Intervention:** The Reserve Bank of India (RBI) was active in the market. While the central bank typically sells dollars to defend the rupee, today's action likely involved **buying dollars** to absorb heavy inflows and smooth out excessive volatility during this sharp appreciation. * **Broader Impact:** Domestic equity indices (Sensex/Nifty) also surged nearly **3%**, fueled by the return of "risk-on" sentiment and expectations of renewed Foreign Institutional Investor (FII) inflows. **Outlook:** Analysts expect the USD/INR pair to consolidate with a negative bias (strength for rupee) in the near term, finding support around **89.75**. However, the RBI is expected to remain vigilant to prevent runaway appreciation and maintain export competitiveness. *** **Next Step:**