The rupee weakened by 10 paise to close at Rs 85.80 against the US dollar on Friday, pressured by weak domestic equity markets, rising global trade tensions , and a strengthening dollar index. The decline came amid growing investor caution after US President Donald Trump imposed a 35% tariff on Canadian goods, fuelling risk-off sentiment.
At the interbank foreign exchange market, the rupee opened at 85.76, hit an intraday low of 85.91, and finally settled at 85.80 — down from Thursday’s close of 85.70, PTI reported.
Analysts said the rupee is likely to remain under pressure due to ongoing trade uncertainty. “We expect the rupee to weaken as the trade war continues to dent global risk sentiments. Uncertainty over trade tariffs and a stronger US dollar index may also pressurise the rupee,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan. He expects the USD-INR pair to trade in the range of 85.55 to 86.25.
Jateen Trivedi, VP – Research Analyst, Commodity and Currency at LKP Securities told PTI “The rise in US tariffs on Brazil and Canada has added to global uncertainty, keeping markets cautious. Additionally, a rebound in the dollar index — from 96.50 to 97.75 — has weighed on emerging market currencies.”
The dollar index was up 0.13% at 97.77, while Brent crude rose 0.34% to $68.87 per barrel.
On the equity front, the BSE Sensex fell 689.81 points, or 0.83%, to 82,500.47, and the NSE Nifty declined 205.40 points, or 0.81%, to 25,149.85. Foreign institutional investors sold shares worth Rs 5,104.22 crore on a net basis, according to exchange data.
Meanwhile, India's forex reserves dropped by $3.049 billion to $699.736 billion in the week ended July 4, according to RBI data released on Friday. This followed a $4.849 billion increase in the previous week.
On the trade front, India is continuing talks with the US to finalise a bilateral trade agreement. Special Secretary in the Commerce Department and chief negotiator Rajesh Agrawal said the two sides are aiming to conclude the first phase of the pact by the fall. A commerce ministry team is expected to visit Washington soon for further discussions, focusing on sectors like agriculture and automobiles.
“We are negotiating a complete deal. Whatever is finalised first can be packaged as an interim agreement, while talks on pending issues will continue,” a government official said.
At the interbank foreign exchange market, the rupee opened at 85.76, hit an intraday low of 85.91, and finally settled at 85.80 — down from Thursday’s close of 85.70, PTI reported.
Analysts said the rupee is likely to remain under pressure due to ongoing trade uncertainty. “We expect the rupee to weaken as the trade war continues to dent global risk sentiments. Uncertainty over trade tariffs and a stronger US dollar index may also pressurise the rupee,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan. He expects the USD-INR pair to trade in the range of 85.55 to 86.25.
Jateen Trivedi, VP – Research Analyst, Commodity and Currency at LKP Securities told PTI “The rise in US tariffs on Brazil and Canada has added to global uncertainty, keeping markets cautious. Additionally, a rebound in the dollar index — from 96.50 to 97.75 — has weighed on emerging market currencies.”
The dollar index was up 0.13% at 97.77, while Brent crude rose 0.34% to $68.87 per barrel.
On the equity front, the BSE Sensex fell 689.81 points, or 0.83%, to 82,500.47, and the NSE Nifty declined 205.40 points, or 0.81%, to 25,149.85. Foreign institutional investors sold shares worth Rs 5,104.22 crore on a net basis, according to exchange data.
Meanwhile, India's forex reserves dropped by $3.049 billion to $699.736 billion in the week ended July 4, according to RBI data released on Friday. This followed a $4.849 billion increase in the previous week.
On the trade front, India is continuing talks with the US to finalise a bilateral trade agreement. Special Secretary in the Commerce Department and chief negotiator Rajesh Agrawal said the two sides are aiming to conclude the first phase of the pact by the fall. A commerce ministry team is expected to visit Washington soon for further discussions, focusing on sectors like agriculture and automobiles.
“We are negotiating a complete deal. Whatever is finalised first can be packaged as an interim agreement, while talks on pending issues will continue,” a government official said.
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