Rupee Opens Stronger As Trump Hints At India-US Trade Deal
US President Donald Trump has imposed 25% to 40% tariff on South Korea, Japan, Malaysia and other countries through tariff letters presented on Monday.
Rupee opened 10 paise stronger against US Dollar at 85.75. The local currency had closed at 85.85 a dollar on Monday. US President Donald Trump has imposed 25% to 40% tariff on South Korea, Japan, Malaysia and other countries through tariff letters presented on Monday.
"Market sentiment remains fragile as investors fear disruption to global trade flows. Strong US employment data and dwindling hopes of Fed cuts provide additional support to the USD," said Kunal Sodhani from FX Hub.
"Today the opening of rupee is slightly higher at 85.76 after Asian currencies showed some recovery this morning and it could remain in a range of 85.40 to 86.00," according to Anil Kumar Bhansali, head of treasury and executive director of Finrex Treasury Advisors.
According to Sodhani, 85.60 acts as a support while 86.20 a resistance for the Rupee and Dollar pair. The local currency on Monday, had slipped by nearly 58 paise after Trump had threatened a 10% extra tariff on BRICS.
"The Indian Rupee recovered towards closing yesterday to 85.85 after falling to 86.04 due to heavy dollar demand in which it lost about 70 ps. Oil companies and importers continued to buy dollar, while there may have been some dollar sales from RBI towards the closing, taking rupee up," added Bhansali.
The White House has sent a total of seven letters to various countries, with its corresponding tariffs. Countries like South Korea, Japan, Kazakhstan and Malaysia have been slapped with a 25% tariff. While countries like Laos and Myanmar see a heavier rate of 40%. South Africa has also been given a 30% tariff rate. According to the latest developments, these levies will be applicable from Aug. 1.
