Rupee vs Dollar, Dec. 9 -- After a year of record lows, the Indian rupee could rebound to 86 to a dollar by 2026, according to Bank of America Global Research. The forecast cuts against the prevailing narrative of sustained weakness, offering a contrarian view grounded in both global and domestic dynamics.

While the rupee has slipped amid global uncertainty and strong dollar demand, BofA argues that recent depreciation reflects temporary distortions rather than structural weakness. "Overall, we believe USD (US dollar) weakness next year would still support mild INR (Indian rupee) appreciation and that could pick-up pace around seasonally favourable 1Q for INR. We forecast INR to reach 86/USD by end-2026, in line with USD weakness next ye...