USD-INR Outlook: How Rupee Stabilization Will Spark A Massive Stock Market Rally

The Indian rupee may have already seen its worst phase, with the USD-INR pair likely having peaked and now moving into a more stable range. While a sharp appreciation may not be on the cards immediately, the period of significant depreciation appears to be behind us, offering relief to investors and markets alike. Sandeep Tandon, Founder & CIO, Quant Mutual Fund, believes that a stabilising rupee could play a crucial role in improving market sentiment over the coming months. He noted that heavy foreign institutional investor (FII) selling was amplified by currency-related losses, but signs of selling exhaustion are now visible. According to Tandon, a stable currency environment could support a gradual reversal in FII flows and provide an additional boost to Indian equities and overall market confidence.