Rupee Opens Lower Against US Dollar Amid Tariff Uncertainties
The softer start comes after the local currency had appreciated slightly on Tuesday.
The Indian rupee opened weaker on Wednesday, slipping by 17 paise to trade at 85.98 against the US dollar, as global market sentiment turned cautious following fresh inflation data from the United States. The softer start comes after the currency had appreciated slightly on Tuesday, supported by easing crude oil prices and a subdued dollar index.
Asian equities opened in the red, reflecting investor unease as expectations for aggressive rate cuts by the US Federal Reserve were dialed back. Traders now see only a marginal chance—just above 50%—of a rate cut in September, with the likelihood of multiple cuts this year fading. This shift in sentiment has kept the dollar relatively firm, limiting gains for emerging market currencies like the rupee.
The Bloomberg Dollar Spot Index remained largely unchanged, while the euro edged up 0.1% to $1.1614. The Japanese yen and offshore yuan also showed minimal movement, trading at 148.82 and 7.1810 per dollar, respectively.
Adding to the cautious tone, an Indian commerce ministry delegation is currently in Washington for a four-day round of negotiations on a proposed bilateral trade agreement. The outcome of these talks could influence future capital flows and currency direction.