Rupee slips as tariff ruling lifts dollar; opens 16 paise lower at 85.52/$

Indian Rupee today: The domestic currency opened 16 paise weaker at 85.52 against the US dollar, after ending at 85.36 on Wednesday

The Indian Rupee extended its fall on Thursday as the dollar strengthened after a federal court ruled to block President Donald Trump's 'liberation day' tariffs.

 

The domestic currency opened 16 paise weaker at 85.52 against the US dollar, after ending at 85.36 on Wednesday, according to Bloomberg. The local unit is on a three-day losing streak while it is set to end the month with a decline of 1.2 per cent. 

 

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  The ruling serves as a setback to Trump, but has helped cheer investors with the dollar index rising back to the 100 level alongside a rally in the Wall Street equity futures contracts. Uncertainty will be at its peak as negotiations may get stalled due to the court ruling, according to experts. 

 

The dollar index, which measures the greenback against a basket of six major currencies, was up 0.36 per cent at 100.23. With See-saw tariff policies continuing to keep investors on edge, the dollar index has fallen 8 per cent this year.  

  The Dollar also rose after the release of the latest FOMC minutes, which struck a notably cautious tone, according to experts. US Federal Reserve officials acknowledged they could face "difficult tradeoffs" in coming months in the form of rising inflation and unemployment.    

The Indian rupee ended nearly unchanged yesterday but is likely to open weaker this morning, as the US dollar index has strengthened and both Asian and European currencies have declined against the dollar, according to Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.  "Till 85.70 is protected, exporters can sell for the near term at this level while importers can buy Dollars for their cash/near-term imports." 

 

The market is currently consolidating within a range and is expected to remain so, supported by steady capital inflows into the country and consistent net equity purchases by foreign portfolio investors, Bhansali said. 

 

On the economic front, growth in India's industrial production fell to an eight-month low of 2.7 per cent in April from an upwardly revised figure of 3.94 per cent in March.

 

In commodities, crude oil prices advanced after the federal court ruled against Trump's tariffs. Brent crude price was up 1.11 per cent to $65.62 per barrel, while WTI crude prices were 1.29 per cent higher at 62.64, as of 9:20 AM IST.