The Indian currency started weak on Wednesday. In the interbank foreign exchange market, the rupee opened at 85.84 against the US dollar and fell to 85.90 within the first hour of trading. This represents a decline of 17 paise compared to the previous day. The rupee is under pressure due to the strength of the dollar in the foreign exchange market.
Strength Seen on Tuesday, Decline on Wednesday
On Tuesday, the rupee had strengthened by 21 paise against the dollar, closing at 85.73, but a decline was recorded again on Wednesday. Traders say that the main reason for the rupee's fall is the strengthening of the dollar in the global market.
The dollar index, which reflects the strength of the US dollar against six major currencies, rose by 0.17 percent and reached 97.68. This further clarifies the b position of the dollar.
Crude Oil Prices Prevented Some Decline
According to traders, even though the dollar has strengthened, the softening in crude oil prices in the international market has saved the rupee from a larger fall.
If this softening in crude oil prices had not occurred, a greater decline in the rupee could have been seen. However, for now, the rupee's movement appears to depend on US policies and global economic conditions.
Trump's Tariff Policy Increased Concerns
The markets have been rattled after US President Donald Trump's warning of imposing hefty tariffs on foreign products.
The Trump administration has proposed tariffs of up to 50 percent on copper and 200 percent on pharmaceutical products. Along with this, a proposal for an additional 10 percent duty on products from BRICS countries has also come to the fore.
This has increased uncertainty in global markets, which is also directly affecting the currencies of emerging economies.
Pressure in IT and Metal Sectors
The Indian stock market also started weak on Wednesday. Specifically, a decline was recorded in the shares of the IT and metal sectors.
ICICI Bank's share fell 0.88 percent and Tata Steel's share fell 0.86 percent. HCL Technologies fell 0.76 percent, Larsen & Toubro 0.68 percent, and Infosys fell 0.55 percent.
Due to these falling companies, the Nifty and Sensex were also under pressure.
Some Stocks Showed Strength
However, amidst the market decline, some stocks also showed strength. Asian Paints rose 1.70 percent among the top 5 gainers, while Hindustan Unilever was up 1.01 percent. Apart from this, Maruti Suzuki was trading with a gain of 0.52 percent, Titan 0.41 percent, and Bajaj Finance 0.40 percent.
Global Investors' Approach Currently Cautious
Dr. V.K. Vijayakumar, Chief Investment Strategist at Geojit Investment Services, says that currently, global investors are waiting for clarity on the US tariffs.
According to him, there is a situation of uncertainty in the market at this time, and no major investor wants to make a decision in haste.
The increasing strength of the dollar, changes in US policies, and geopolitical tensions are making investors' strategy cautious.
Pressure on Asian Currencies Against the Dollar
The impact of the dollar's strength is not only being seen on the Indian rupee but also on other Asian currencies. Weakness has been recorded in several currencies, which makes it clear that the strength of the US economy is currently a challenge for the global market.
Waiting for the Next Step in the Market
Due to the current situation on the global economic front, the rupee is under considerable pressure. The rupee's direction in the coming days will be determined by the next step from the US on tariffs, the policy of the Federal Reserve, and the stance of the global economy.
