INR pressured by firm dollar amid tariff uncertainty

The Indian rupee declined 18 paise against the US dollar to close at 85.94 (provisional) on Wednesday, tracking a strengthening American currency against major crosses overseas amid uncertainties over the India-US trade pact. Dollar index firmed up near a three-week high as investors awaited the latest producer price index report after hot inflation data pared back expectations of Fed interest rate cuts this year. Meanwhile, Dallas Fed President Lorie Logan supported this view earlier on Wednesday, defending the need to keep interest rates at the current level for some time, to keep inflation at low levels amid the upside risks stemming from Trumps tariffs. However, renewed foreign capital inflows and sliding global crude prices supported the domestic unit. Indian shares recovered from an early slide to end marginally higher on Wednesday as the dollar pulled back slightly and U.S. Treasury yields retreated after rising in the previous session. The benchmark S&P/BSE Sensex ended a choppy session up 63.57 points, or 0.08 percent, at 82,634.48, while the broader NSE Nifty index closed at 25,212.05, up 16.25 points, or 0.06 percent, from its previous close. At the interbank foreign exchange, the rupee opened weak at 86.02 against the dollar. It traded in the range of 85.74-86.05 during the day before closing at 85.94.

 

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