On Monday, the US dollar dropped against most Asian currencies, with the Indian rupee appreciating by 14 paise to 86.46 against the dollar. This rise in the rupee came amid a broader weakness in the greenback, as the dollar index fell by 0.30% to 109.02. The rupee opened at 86.48 and moved to 86.46, tracking the positive momentum in both the domestic stock market and other Asian currencies. As US President Donald Trump prepares for his return to office, markets are watching closely for policy announcements that could impact the currency markets. Trump is expected to sign several executive orders on his first day back, which could inject fresh volatility into the dollar index. The market’s focus remains on potential trade disruptions and the impact of rising tariffs and sanctions, which could increase safe-haven demand for the dollar. Domestically, India’s forex reserves fell by $8.714 billion to $625.871 billion as of January 10, partly due to the RBI’s efforts to curb excessive depreciation of the rupee. Liquidity pressures, exacerbated by a ₹2.22 trillion banking system deficit and FII outflows of $6.4 billion, continue to add strain. However, the upcoming ₹2,000 crore QIP offering from Punjab and Sind Bank could offer some relief, potentially stabilizing the rupee.