The Indian rupee opened sharply higher against the US dollar on Tuesday, February 3, 2026, following a reduction in US tariffs on India. The currency gained about 1.2 percent in early trade to reach 90.40.
The move followed a decision by the United States to cut tariffs on Indian goods from 50 percent to 18 percent. The announcement supported market sentiment and contributed to the rupee’s best opening in several months.
In the interbank foreign exchange market, the rupee opened at 90.30 against the dollar, compared with the previous close of 91.49, reflecting a gain of 119 paise.
The dollar index, which measures the US currency against six major peers, declined 0.20 percent to 97.43. The softer dollar supported emerging market currencies, including the rupee.
Brent crude futures fell 0.41 percent to $66.03 a barrel, providing additional support to the domestic currency.
Foreign exchange traders said the tariff reduction altered near-term market conditions and improved sentiment toward Indian assets, with expectations of improved export competitiveness.
According to stock exchange data, foreign institutional investors sold shares worth ₹1,832.46 crore on Monday. Despite the outflows, the rupee strengthened amid tariff-related developments and global cues.
Equity markets also opened higher, with export-oriented sectors in focus following the tariff cut. Companies in pharmaceuticals, information technology, auto components, and textiles were among those tracking the impact of lower US tariffs.
The pharmaceuticals sector derives an estimated 30 to 40 percent of its revenue from the US market. The tariff reduction is expected to lower costs for exporters across multiple sectors, including IT services, auto components, and textiles.
