Currency watch: Rupee slips 25 paise to 88.53 against US dollar; Trump tariffs & H-1B visa fee hike weigh on sentiment
Rupee slips 25 paise to an all-time intraday low of 88.53 against the US dollar in early trade on Tuesday, as concerns over enhanced US tariffs on Indian goods and the new $100,000 H-1B visa fee weighed on investor sentiment.Forex traders said that global risk aversion and trade policy uncertainty further exacerbated the rupee’s decline.At the interbank foreign exchange, the rupee opened at 88.41 and fell to 88.53, marking a 25 paise drop from its previous close.
On Monday, the rupee had declined 12 paise to 88.28 against the dollar.Traders noted that the rupee is approaching record low levels as market participants assess the likely impact of the H-1B levy, which could slow remittance growth and reduce service exports to the US.
Risk aversion in domestic markets is also adding pressure.“The RBI has been the only dollar provider with some small inflows on account of IPOs of Rs 7,500 crore being launched this week, but getting absorbed by the large buying of dollars,” said Anil Kumar Bhansali, head of treasury and executive director, Finrex Treasury Advisors LLP.“The RBI, however, has limited direct currency intervention, thus allowing greater volatility and possible further declines in the rupee, which has made new lows against most currencies,” he added, as quoted by PTI.
Dollar index and crude oil update
The dollar index, which tracks the greenback’s strength against six major currencies, was trading 0.03% lower at 97.30.
Brent crude futures fell 0.62% to $66.16 per barrel.
Domestic equities pressure
On the domestic equity front, the Sensex fell 207.78 points, or 0.25%, to 81,952.19 in morning trade, while the Nifty dropped 68.40 points, or 0.27%, to 25,133.95.Foreign Institutional Investors (FIIs) sold equities worth Rs 2,910.09 crore on Monday.In related developments, commerce and industry minister Piyush Goyal is leading an official delegation to the US for trade talks, reported PTI.The team aims to advance discussions toward a mutually beneficial trade agreement.
The minister will visit New York, accompanied by special secretary Rajesh Agrawal and other officials.
