Rupee Appreciates 10 Paise to ₹ 86.71 Against US Dollar

On Tuesday, March 18, 2025, during early trading, the Indian rupee rose by 10 paise to reach ₹86.71 against the US dollar. This appreciation occurred at the interbank foreign exchange. The rupee's opening at ₹86.71 against the greenback marked an increase from its previous closing value.

Factors Supporting Rupee's Rise

The rupee's gain was attributed to several factors, including tracking its Asian peers and receiving support from positive domestic equities. The 30-share BSE Sensex was trading higher by 577.71 points (0.78%) at 74,747.66 points, and the Nifty also saw an increase of 174.05 points (0.77%) at 22,682.80 points. Several Asian currencies also experienced slight gains, with CNH, IDR, and KRW rising.

Concerns Limiting Further Gains

Forex traders indicated that the sharp upside for the rupee was restricted due to investors considering the potential economic impact of growing global trade concerns. Anil Kumar Bhansali from Finrex Treasury Advisors LLP noted that fears surrounding US President Donald Trump's aggressive tariff policies potentially triggering a broader economic slowdown had undermined the US dollar. He also highlighted concerns on the domestic macroeconomic front, where India's trade deficit fell to a three-and-a-half-year low, but exports contracted sharply, and imports also saw a significant decline. Bhansali added that uncertainty surrounding exports remains due to the threat of Trump's reciprocal trade tariffs and softening global oil prices, along with rising economic uncertainty.

US Dollar's Performance

Meanwhile, the US dollar index, which measures the greenback's strength against six other currencies, was trading 0.19 per cent higher at 103.56.

Impact of Trump's Trade Policies

Concerns were raised that US President Donald Trump's plan to impose broad reciprocal tariffs and sector-specific trade restrictions starting from April 2 could further pressure the rupee.

Foreign Institutional Investors Activity

On Monday, foreign institutional investors (FIIs) offloaded equities worth ₹4,488.45 crore on a net basis.

Global Oil Benchmark

Brent crude, the global oil benchmark, was trading 0.21 per cent higher at USD 71.22 per barrel in futures trade.

Previous Day's Rupee Movement

On the preceding day, Monday, the rupee had appreciated by 24 paise to close at ₹86.81 against the US dollar.

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