Indian Rupee opens 21 paise weaker at 85.68/$ with Trump tariffs in focus

The Indian Rupee weakened on the first trading day of the financial year as traders assessed the impact of reciprocal tariffs taking effect today.

 

The domestic currency opened 21 paise weaker at 85.68 against the greenback after closing at 85.47 on Friday, according to Bloomberg data. Tracking the fall in the dollar index, the currency appreciated by 2.39 per cent in March, registering the best month since November 2018. Meanwhile, during the last financial year, it witnessed a 2.42 per cent fall. 

 

US President Donald Trump is expected to announce his reciprocal tariffs plan on Wednesday during an event in the White House Rose Garden. Media reports indicate that the White House has not yet finalised its tariff plan, with Trump's team still deliberating on their options ahead of the event. 

 

 

Indian rupee is scheduled to open slightly weak on Trump reciprocal tariffs, with investors watching out for how it will affect the country, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP. The rupee benefitted from broad dollar weakness and the Reserve Bank of India (RBI) allowing a two-way movement without much of an intervention in the month of March. 

 

After registering a 3.2 per cent decline in March, the dollar index — a measure of the value of the US dollar relative to a basket of foreign currencies — was down 0.07 per cent to 104.18.  Watch Video | From ₹70 to ₹90 vs the dollar: Is a weaker rupee good or bad for Indian Economy?

 

Any imposition of tariffs on Indian goods could put additional pressure on the rupee, while relief from such tariffs would provide much-needed support to the currency, Amit Pabari, managing director at CR Forex Advisors, said. Driven by rising crude prices and escalating concerns over reciprocal tariffs, the rupee is expected to find strong support around 85.50-85.60, with a potential rebound towards 86.00-86.20 levels, he said.  

 

Brent prices have surged by more than $6 per barrel since its recent lows, stoking concerns about rising inflation in India, Pabari said. Crude oil prices remained little changed, pausing last month’s rally as traders' focus turns to the implications of 'liberation day'. Brent crude oil was down 0.04 per cent to $74.46 per barrel, while WTI crude was flat at 71.20 per barrel as of 9:10 AM IST.