Indian rupee sticks to losing run as outflows, tariff worries sustain pressure
The rupee closed at 86.3675 against the U.S. dollar, down 0.1% on the day.
The rupee has fallen around 0.6% over its five-day losing streak, weighed by a modest rebound in the dollar index, foreign portfolio outflows, and concerns over the economic fallout from U.S. President Donald Trump's ongoing trade war.
Equity markets in Asia and Europe were mostly lower on Tuesday, while Wall Street futures were flat after the S&P 500 and Nasdaq hit record highs in the previous session.
Regional currencies were trading mixed and India's benchmark equity indexes, the BSE Sensex and Nifty 50 closed a tad lower.
While markets have shown a relatively muted reaction to the latest trade salvos from the White House in July, analysts said the complacency may start to fade as the deadline for trade deals draws closer.
Indian rupee weakens slightly, broad dollar softness cushions pressure
'Markets' defiant approach to tariff news will be tested in the coming days as the risk of no trade deals before the 1 August deadline rises,' ING said in a note.
The prospects of an interim trade deal between India and the United States before the deadline have dimmed, as talks remain deadlocked over tariff cuts on key agricultural and dairy products, Reuters reported earlier on Tuesday.
In the absence of a trade deal, Indian exports would be subject to a 26% tariff.
The European Union, meanwhile, is preparing possible countermeasures against the U.S. as prospects for an acceptable trade agreement fade, per EU diplomats.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Express Tribune
5 hours ago
- Express Tribune
Dar touts inflation dip, better global relations
Listen to article Deputy Prime Minister and Foreign Minister Ishaq Dar said Pakistan has emerged from diplomatic isolation and is witnessing economic recovery, highlighting a sharp drop in inflation and growing international engagement. Speaking to the Pakistani community at the Consulate General in New York on Saturday, Dar said, 'We have made considerable progress, especially in political and economic fields, in the past three years, despite heavy odds – we are indeed a resilient nation.' Dar, who returned earlier in the day from Washington, said his meeting with US Secretary of State Marco Rubio was held in a cordial atmosphere and covered key global and regional matters. 'The meeting went very well,' he said, expressing hope for stronger bilateral ties. Present at the event were Pakistan's Ambassador to the United States Rizwan Saeed Sheikh, Permanent Representative to the UN Ambassador Asim Iftikhar Ahmad, and Consul General Aamir Ahmed Atozai. Dar told the audience that Pakistan was no longer isolated and now enjoys support from many nations, evidenced by recent high-level meetings with officials from China, the US, and others. He pointed to the reduction of inflation from 40% to 2.4% as of January 2025 as proof of government effectiveness. The DPM/FM said investor confidence had returned following the successful conclusion of the IMF programme, a recovery acknowledged by international credit agencies. He reaffirmed the government's ambition to join the G20. Dar credited PML-N leader Nawaz Sharif for steering the federal and Punjab governments, calling him an able statesman. He also briefed the community on the Special Investment Facilitation Council (SIFC), which aims to ease investment in key sectors. He announced that work was under way to resume PIA flights to New York, following the restoration of routes to Europe and the UK. Appreciating the Pakistani-American community's role, Dar acknowledged their contributions to Pakistan and the US, praising their unity during past tensions with India. He recounted the shooting down of six Indian aircraft by the Pakistan Air Force and praised the leadership of Chief of Army Staff Field Marshal Syed Asim Munir. Dar noted Pakistan's presidency of the UN Security Council—secured with support from 182 countries—and the unanimous adoption of a Pakistan-sponsored resolution on peaceful settlement of disputes. He reaffirmed Pakistan's commitment to diplomacy, peaceful regional ties, and its outreach to Afghanistan for trade and rail connectivity, while expecting Afghan soil not to be used for terrorism. On Aafia Siddiqui's incarceration, he said efforts for her release were ongoing through diplomatic channels. Ambassador Sheikh also addressed the community, noting Pakistan's improved global image following the armed forces' role in national defence. He urged the diaspora to invest in Pakistan, saying a strong economy is vital for national security.
Business Recorder
9 hours ago
- Business Recorder
US business delegation to visit China, SCMP says
A high-level delegation from the US-China Business Council will visit China this week and is expected to meet senior Chinese officials, the South China Morning Post reported on Sunday, citing two sources familiar with the matter. US, China reach deal to ease export curbs Reuters could not immediately verify the report.
Business Recorder
9 hours ago
- Business Recorder
Trump, EU's von der Leyen to meet on Sunday to clinch trade deal, avert trade war
BRUSSELS/EDINBURGH: European Commission President Ursula von der Leyen is set to meet US President Donald Trump on Sunday to clinch a trade deal for Europe that would likely see a 15% baseline tariff on most EU goods, but end months of uncertainty for EU companies. Trump, in Scotland for a few days of golfing and bilateral meetings, told reporters upon his arrival on Friday evening that von der Leyen was a highly respected leader and he was looking forward to meeting with her on his golf course in Turnberry. He said there was a 50-50 chance that the U.S. and the 27-member European Union could reach a framework trade pact, adding that Brussels wanted to 'make a deal very badly.' The EU faces U.S. tariffs on more than 70% of its exports, with 50% on steel and aluminium, 25% on cars and car parts and a 10% levy on most other EU goods. Trump has said he would hike the rate to 30% on August 1, a level EU officials said would wipe out whole chunks of transatlantic commerce. Further tariffs on copper and pharmaceuticals are looming. A 15% tariff on most EU goods would be seen by many in Europe as a poor outcome compared to the initial European ambition of a zero-for-zero tariff deal on all industrial goods. But it would be better than 30% and it would remove uncertainty about business conditions that has already hit profits of European companies. For Trump a deal with the EU would be the biggest trade agreement, surpassing the $550 billion accord reached with Japan earlier this week. Trump, who is seeking to reorder the global economy and reduce decades-old U.S. trade deficits, has so far reeled in agreements with Britain, Japan, Indonesia and Vietnam, although his administration has failed to deliver on a promise of '90 deals in 90 days.' The EU deal would be a huge prize, given that the US and EU are each other's largest trading partners by far and account for a third of global trade. While close, a deal still requires some final negotiations. US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick departed Washington for Scotland on Saturday for talks with EU Trade Commissioner Maros Sefcovic, who is also travelling to Scotland, before the Trump-von der Leyen meeting. 'We're cautiously optimistic that there will be a deal reached,' said a Trump administration official, who spoke on he condition of anonymity. 'But it's not over till it's over.' In case there is no deal and the U.S. imposes 30% tariffs from August 1, the EU prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods. EU diplomats have said a possible deal would likely include a broad 15% tariff on EU goods imported into the US, mirroring the US-Japan deal, along with a 50% tariff on European steel and aluminium. Trump told reporters there was 'not a lot' of wiggle room on the 50% tariffs that the U.S. has on steel and aluminium imports, adding, 'because if I do it for one, I have to do it for all.' It remains unclear if Washington would exempt EU imports from other sectoral tariffs on automobiles, pharmaceuticals and other goods that have already been announced or are pending although EU officials are hopeful the 15% baseline tariff would apply also to cars and pharmaceuticals.
