Rupee ends 20 paise stronger; Dollar's comeback keeps currency above 85/$

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The Indian Rupee closed stronger against the US Dollar on Friday but failed to end below the 85 mark as the dollar index's positive rally capped the currency's gain. 

 

The domestic currency strengthened 20 paise to close at 85.24 against the greenback after closing at 85.44 on Thursday, according to Bloomberg data. In the initial trade, the Rupee fell past the 85 mark to trade at 84.95 against the dollar, the highest since December 2024. After appreciating by 2.39 per cent in March, the Rupee rose by 0.45 per cent in April so far. 

 

As the risk of recession increased, the dollar index — a measure of the value of the US dollar relative to a basket of foreign currencies — was up 0.51 per cent to 102.58. Earlier in the day, the dollar index fell to 101.73, the lowest since September 2024. 

 

This comes a day after US President Donald Trump unleashed a barrage of tariffs even as analysts from JPMorgan to Bernstein expect the risk of recession and inflation to rise in the US. He announced tariffs of at least 10 per cent on practically all imports, with higher rates on countries that have the highest trade deficits with the US.

 

The currency traded positively, supported by weakness in crude prices, which helped the rupee maintain its strength, according to Jateen Trivedi, VP research analyst - Commodity and Currency, LKP Securities. "However, the dollar index's positive rally capped further appreciation in the rupee." With non-farm payroll data and unemployment data scheduled for release in the evening, markets are expected to remain cautious, and the rupee may react sharply depending on the outcome, he said.

 

After Trump unleashed his 'discounted' tariffs, US international setback poured in with Canada announcing 25 per cent retaliatory tariffs on some US-made vehicles while France’s Emmanuel Macron urged companies to pause US investments. The retaliatory tariffs from trading partners could trigger a global trade slowdown, adding to recessionary fears, according to Amit Padari, managing director of CR Forex Advisors. 

 

Crude oil prices fell to their lowest level since August 2021 as OPEC+ 's decision to increase output faster than previously announced, combined with a tariff announcement that dented the outlook. Brent crude oil was down 3.31 per cent to $67.82 per barrel as of 3:30 PM IST.