Rupee Opens Weaker Against US Dollar Despite Renewed Trade Talk Optimism

The Indian Rupee opened weaker against the US Dollar on Wednesday. The domestic currency opened 3 paise weaker at 88.14 against the US Dollar after it settled at 88.11 on Tuesday.

The weakness comes despite a positive comment by US President Donald Trump, saying India and the US are continuing negotiations to address the trade barriers between the two nations, and that he is looking forward to speaking with Prime Minister Narendra Modi.

PM Modi also responded saying that he is confident of India and the US concluding trade talks early, calling the two countries "close friends and natural partners." Modi said he is looking forward to speaking with Trump. "India and the US are close friends and natural partners. I am confident that our trade negotiations will pave the way for unlocking the limitless potential of the India-US partnership. Our teams are working to conclude these discussions at the earliest," Modi said in a post on X.

The rupee's decline comes as FPIs continued their dollar buying and importers continued to take a toll on the Indian Rupee, said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP

"The FPIs had bought equities yesterday and despite Trump's positive announcement the Rupee opened slightly lower and with RBI continuing to protect the level of 88.20/30, the rupee could gain towards 87.80 today," he said. "Dollar Index was higher today at 97.78 and US -10 year at 4.0820% while Asian currencies were a tad lower which may keep the bids coming in at slightly lower level of the rupee."

Brent oil prices rose up moderately to $66.92, making a modest gain of 0.80% as Israel attacked Hamas Leadership in Doha, Qatar, raising concerns about potential supply disruptions in the region.