Image Source : PIXABAY On Friday, the rupee settled flat at 86.62 against the American currency.
The rupee plunged 67 paise to hit a record low of 87.29 against the US dollar in early trade today i.e. on February 3, 2025. The sharp fall comes after Trump Tariffs on Canada, Mexico and China triggered fears of a broad trade war.
US President Donald Trump has slapped Canada and Mexico with 25 per cent duties and China with a 10 per cent duty. While China is yet to respond, Canada and Mexico have vowed retaliatory tariffs.
The rupee continued to face pressure due to sustained foreign fund outflows and the broad strength of the American currency in the overseas markets due to unabated dollar demand from oil importers and weak risk appetite, they added.
At the interbank foreign exchange, the rupee opened at 87.00 and slipped further to 87.29 against the greenback in initial deals, a plunge of 67 paise from its previous close.
On Friday, the rupee settled flat at 86.62 against the American currency.
“The start of the week saw financial markets on edge as US President Donald Trump followed through on his tariff threats, imposing duties on imports from Mexico, Canada, and China,” CR Forex Advisors MD- Amit Pabari said.
This escalating trade war has fuelled risk aversion, propelling safe-haven demand for the US dollar, which has surged toward 109.50 levels, Pabari added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 1.30 per cent higher at 109.77.
“The US dollar surged on Trump Tariffs sending global FX to multi-year lows as the Euro fell to 1.0224, GBP to 1.2261 and Yen to 155.54.
The US dollar index rose to 109.77, while US 10-year yields were at 4.4980 per cent.
“Amongst Asian currencies Yuan slumped to 7.3551, IDR to 16448 and KRW to 1470,” said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
Brent crude, the global oil benchmark, rose 0.71 per cent to USD 76.21 per barrel in futures trade.
With PTI inputs
