RBI DG Poonam Gupta says ‘fair case’ for rupee to appreciate from current levels

RBI Deputy Governor Poonam Gupta said the rupee’s 13.1 per cent depreciation since March 2025 could be a temporary phenomenon, pointing to an expected improvement in India’s current and capital accounts and saying there is a “fair case” for the currency to not just stabilise but potentially appreciate from current levels.

The rupee’s cumulative depreciation over the past year and a half could prove temporary as India’s balance of payments position improves, Reserve Bank of India Deputy Governor Poonam Gupta said on Wednesday, and that there is a “fair case” for the currency to appreciate from current levels. Gupta, speaking at the 13th SBI Banking & Economics Conclave , said India’s current account deficit should shrink further in the coming years, while the capital account could turn more favourable, plausibly from later in the current financial year. “The recent oil price and gold price shocks have pushed CAD temporarily higher,” Gupta said, noting that the capital account surplus had fallen short of the current account deficit in the last two years.

6 billion in 2025-26, she said. However, Gupta said India’s CAD has traditionally remained small and has declined as a share of GDP over time. Net services exports and remittances remain key structural strengths and are large and resilient enough to absorb the merchandise trade deficit, keeping the current account deficit below 1 per cent of GDP, she said. 1 per cent on a point-to-point basis between March 31, 2025 and September 16, 2026, Gupta said.

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