The rupee depreciated in July but stayed stable; August saw gains after India’s sovereign rating upgrade.

• RBI noted the rupee remained among the least volatile EMDE currencies despite depreciation and global trade uncertainty concerns.
• In real effective terms, the rupee appreciated as inflation outpaced major trading partners, offsetting the nominal depreciation impact.
• Gains in August followed S&P’s India sovereign rating upgrade, boosting investor confidence and supporting the rupee’s upward movement.