MUMBAI, June 26 (Reuters) - The Indian rupee is set to open higher on Thursday, boosted by the dollar's tumble to multi‑year lows after U.S. President Trump renewed his criticism of Federal Reserve Chair Jerome Powell and reportedly floated plans of his early replacement.

The 1-month non-deliverable forward indicated a open in the 85.96 to 85.98 range, versus 86.0775 in the previous session.

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The rupee rose above the 86 level in the last two sessions, but failed to sustain those moves. It touched an intraday high of 85.80 on Wednesday.

The dollar/rupee pair "looks well supported at the 85.80–86 zone, and import demand tends to show up there, so downside will be sticky", a currency trader at a bank said, while pointing out that the 21-day moving average is at 85.90.

Unless the USD/INR pair decisively breaks below the 85.80–85.90 region on flows, it will likely stay rangebound with broad dollar cues "largely immaterial", he said.

DOLLAR SLIDES, ASIA CLIMBS

The dollar index dipped in Asia, heading for its sixth straight daily decline. The euro, which has the highest weightage in the dollar index, hit a multi-year high against the dollar, boosted by NATO developments.

Concerns about the future independence of the U.S. Federal Reserve weighed on the dollar.

According to a Wall Street Journal report, Trump had toyed with the idea of selecting and announcing Fed Chair Powell's replacement by September or October.

Trump on Wednesday called Powell "terrible" for not lowering interest rates sharply, while the Fed chair was telling the Senate that policy had to be cautious with the President's tariff plans posing a risk to inflation.

The Korean won and the Taiwanese dollar led Asian currencies higher.

KEY INDICATORS:

** One-month non-deliverable rupee forward at 86.10; onshore one-month forward premium at 12.50 paise

** Dollar index down at 97.44

** Brent crude futures up 0.5% at $68 per barrel

** Ten-year U.S. note yield at 4.27%

** As per NSDL data, foreign investors sold a net $503.6 mln worth of Indian shares on June 24

** NSDL data shows foreign investors sold a net $22.9 mln worth of Indian bonds on June 24

https://www.reuters.com/world/india/trumps-fed-backlash-undermines-dollar-primes-rupee-higher-open-2025-06-26/