Rupee extends gains to third day amid Trump tariffs; opens at 85.62/$

Indian Rupee today: The domestic currency opened 6 paise higher at 85.62 against the dollar on Thursday

The Indian Rupee extended its advance for the third day amid US President Donald Trump's tariff demand letters to additional countries.

 

The domestic currency opened 6 paise higher at 85.62 against the dollar on Thursday, according to Bloomberg. The rupee has depreciated by 0.15 per cent against the greenback in the current financial year, and has witnessed 0.03 per cent depreciation in the current calendar year.

 

The currency rose on Wednesday despite a decline in the stock markets, supported by foreign portfolio investors (FPIs) turning buyers of equities and sellers of dollars, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. 

 

It is expected to open flat this morning, with FPIs likely to continue their equity purchases and corresponding dollar sales, Bhansaid said. "Exporters are advised to sell dollars on any uptick in the pair, while importers can consider buying at 85.50 or below, if such levels are seen during the day." 

The Rupee’s gain in today's session is in line with the strength seen in other Asian currencies.

 

 

On Wednesday, Brazil was hit with a 50 per cent levy, while Trump imposed a 30 per cent tariff on Algeria, Libya, and Iraq. Sri Lanka was hit with 25 per cent duties. Trump also said the US would begin levying a 50 per cent tariff on copper imports from August 1.  

 

Meanwhile, US Federal Reserve (Fed) minutes signalled that tariff-driven inflation may not derail rate cuts. The dollar index, a measure of the greenback against a basket of six major currencies, was down 0.19 per cent at 97.37. 

 

Vigilance is warranted as the US Dollar Index strengthens and long-term US and Japanese bond yields surge, potentially sparking risk-off sentiment in global markets, according to Anindya Banerjee, head of currency and commodity, Kotak Securities. "We anticipate dollar-rupee to trade within an 85.50–86.50 range on the spot market, with an upward bias."

 

Investors eye the US Jobless Claims data and Japan's Producer Price Inflation data. 

 

In commodities, crude oil prices fell as President Trump's tariff measures weighed on the global economic growth outlook and oil demand. Brent crude price was down 0.03 per cent at $70.17 per barrel, while WTI crude prices were lower by 0.12 per cent at 68.30, as of 9:15 AM IST.