Key Highlights
- Rupee closed at 85.86 per USD, down by 47 paise on Monday.
- During intraday trade, it breached the 86-mark, touching 86.03 before mild recovery.
- The partial recovery is attributed to RBI intervention via dollar sales.
Trigger: Trump’s Tariff Announcement
- Former U.S. President Donald Trump announced a 10% tariff on countries aligning with BRICS (Brazil, Russia, India, China, South Africa).
- He labelled such alignments as “anti-American”, causing global trade jitters.
- The 90-day tariff suspension window is also set to expire, with no new trade deal signed yet.
Other Contributing Factors
- Strong demand for dollars by a major private bank put further pressure on the rupee.
- Stop-loss orders were triggered once the rupee crossed 85.80, leading to more depreciation.
- The Dollar Index rose to 97.36 from 96.95, strengthening the greenback against a basket of six currencies.
