What's driving the Indian Rupee right now and what's next?

The US dollar weakened and the Indian rupee strengthened after reports suggested a US-Iran deal was imminent and could reopen the Strait of Hormuz, easing geopolitical risks. However, both moves partially reversed likely because the expected deal announcement failed to materialize. The RBI kept rates unchanged at 5.25% and maintained a neutral stance, offering little support to the rupee. Looking ahead, next week's US CPI report is the key event, with hotter inflation likely boosting the dollar and softer inflation weighing on it.