The rupid opened on 87,5050, but failed to extend in the profits and finished Plat on 87,6600 by the end of Friday of 87,6600.
Traders said that banks in the private sector were taken to buy dollars, largely on behalf of importer clients who cover positions in the midst of increased market volatility, after the decision of US President Donald Trump to impose 50% rates on Indian goods.
In the past two weeks, the rupee has come close to violating its low point of 87.95, but intervention by the Reserve Bank of India in both the NDF and the onshore spot markets helped to prevent a new low point.
Analysts warned that the steep rates – one of the highest imposed by the US on every trading partner – could weigh on exports and capital flows to India.
“Banks are vigilant about creating positions because of the volatility through tariff uncertainty and the corresponding interventions made by the Central Bank,” says Dilip Parmar, Forex analyst at HDFC Securities. In the meantime, Asian currencies remained largely stable against a softer dollar, because investors remained careful prior to the US inflation report and the passage of an American tar loveadline on China. The Filipino peso and South Korean won slid between 0.1% and 0.3%, while most other regional units had not changed much. The dollar index was largely close to 98,254 out of 1018 GMT and has been volatile all day, about the growing expectations of a federal reserve rate rate next month.
The American inflation data for July, Tuesday, will be the key to gauge the rate-cut expectations of the Fed and the direction of the dollar.
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