Rupee Opens Weaker Against US Dollar Amid Trade Uncertainty, Global Cues

The Indian rupee opened 7 paise weaker against the US dollar on Monday, trading at 86.22 per dollar compared to Friday’s closing rate of 86.15. This marks the fourth consecutive session of weakness for the local currency, reflecting ongoing global uncertainties and cautious investor sentiment.

The rupee’s subdued start comes on the heels of a volatile week in global markets, where concerns over trade negotiations and monetary policy have kept emerging market currencies under pressure.

Notably, a four-day round of trade talks between Indian and US officials took place last week, from Monday to Thursday, in Washington. While the discussions aimed to resolve key issues in the proposed bilateral trade agreement, no major breakthroughs were announced, leaving markets in a wait-and-watch mode.

On the global front, US President Donald Trump dismissed reports suggesting that Treasury Secretary Scott Bessent had warned of market turmoil if Federal Reserve Chair Jerome Powell were removed. This political uncertainty, coupled with stiffening tariff positions from the US ahead of the Aug. 1 deadline, has added to the cautious tone in currency markets. European Union envoys are expected to meet this week to prepare countermeasures in case of a no-deal scenario with the US.

Despite the rupee’s weakness, the Bloomberg Dollar Spot Index remained largely unchanged, indicating a mixed sentiment toward the greenback. The euro held steady at $1.1618, while the Japanese yen strengthened slightly to 148.53 per dollar. The offshore yuan also showed minimal movement, trading at 7.1792 per dollar.

On Friday, the rupee had closed 4 paise lower at 86.16 against the dollar, weighed down by rising global crude oil prices and a sharp decline in domestic equity markets. However, the dollar’s weakness against major currencies helped limit the rupee’s losses.