A roadside currency exchange vendor counts notes in New Delhi, India, February 10, 2025. REUTERS/Priyanshu Singh
| Photo Credit: PRIYANSHU SINGH
The rupee slumped 26 paise to 85.78 against the U.S. dollar in early trade on Thursday, after U,S. President Donald Trump unleashed reciprocal tariffs on about 60 countries.
The U.S. has announced 27% reciprocal tariffs on India, saying New Delhi imposes high import duties on American goods, as the Donald Trump administration aims to reduce the country’s trade deficit and boost manufacturing.
The move is expected to impact India’s exports to the U.S. However, experts say that India is better-placed than its competitors, who also face increased levies.
Forex traders said, Mr. Trump’s reciprocal tariffs sent shockwaves through the market, and investors sought for safe haven.
At the interbank foreign exchange, the rupee opened at 85.77 against the greenback, then lost ground and touched 85.78, down 26 paise from its previous close.
On Wednesday, the rupee had settled at 85.52 against the U.S. dollar.
The new tariffs would bring about a fully-blown trade war which could in turn trigger a sharp global economic slowdown, forex traders added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.72% lower at 103.06.
Brent crude, the global oil benchmark, fell 2.20% to $73.30 per barrel in futures trade.
The Indian rupee opened weak on risk aversion, as India was subjected to 27% of tariffs, which was unexpected, said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
The range today is expected between 85.50 to 86.00, and exporters may sell as rupee approaches 86.00, he added.
In the domestic equity market, the 30-share BSE Sensex fell 324.40 points, or 0.42%, to 76,293.04, while the Nifty declined 75.05 points, or 0.32%, to 23,257.30 points.
Foreign institutional investors (FIIs) offloaded equities worth ₹1,538.88 crore on a net basis on Wednesday, according to exchange data.
Published – April 03, 2025 10:23 am IST
