The rupee pared its initial losses and settled for the day higher by 22 paise at 85.30 (provisional) against the US dollar on Thursday as the greenback weakened against its major peers after President Donald Trump unleashed reciprocal tariffs on about 60 countries.
The domestic unit had witnessed a knee jerk reaction in early trade but soon gained the lost ground and ended the day on a positive note, after the US announced 27 per cent reciprocal tariffs on India,
saying New Delhi imposes high import duties on American goods. Experts, however, said that India is better-placed than its competitors, who also face increased levies. At the interbank foreign exchange, the rupee opened at 85.77 then touched an intraday high of 85.30 and a low of 85.78 against the greenback. The unit ended the session at 85.30 (provisional) against the dollar, registering a gain of 22 paisa from its previous closing level.
On Wednesday, the rupee had settled at 85.52 against the US dollar. The US reciprocal tariffs are expected to impact India’s exports of certain sectors to the US, experts said, adding that India is better-placed than its competitors, including Bangladesh (37 per cent), China (54 per cent), Vietnam (46 per cent) and Thailand (36 per cent) who face increased levies.
Meanwhile, according to an official statement on Thursday, the Department of Commerce is carefully examining the implications of the US reciprocal tariffs on India and is engaged with all stakeholders, including domestic industry and exporters to seek their feedback on the issue. The commerce ministry said that it is also studying the opportunities that may arise due to this new development in the US trade policy.
It also said that discussions are ongoing between Indian and US trade teams for the expeditious conclusion of a mutually beneficial, multi-sectoral Bilateral Trade Agreement (BTA). The BTA will cover a wide range of issues of mutual interest, including deepening of supply chain integration. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 1.65 per cent lower at 102.09.
Brent crude, the global oil benchmark, fell 4.10 per cent to USD 71.88 per barrel in futures trade.
In the domestic equity market, the 30-share BSE Sensex fell 322.08 points, or 0.42 per cent, to settle at 76,295.36, while the Nifty declined 82.25 points, or 0.35 per cent, to close at 23,250.10 points.
Foreign institutional investors (FIIs) offloaded equities worth Rs 1,538.88 crore on a net basis on Wednesday, according to exchange data.
