The rupee appreciated 40 paise to 87.25 against the US dollar in early trade on Friday, amid lower crude prices and suspected RBI interventions as the US’s imposition of a 25 per cent tariff on Indian exports heightened investors’ concerns.
Forex traders said the US’s imposition of a 25 per cent tariff on Indian exports triggered risk-off sentiment and heightened concerns regarding further rupee depreciation.
Moreover, investors are focussed on US President Donald Trump’s imposition of new, and mostly higher tariffs on US trading partners beginning August 1.
At the interbank foreign exchange market, the rupee opened at 87.60 and touched an early high of 87.25 against the greenback, registering a gain of 40 paise from its previous close.
On Thursday, the rupee recovered 15 paise from an all-time low level to close at 87.65 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose by 0.07 per cent to 100.03.
“The dollar headed for its best week in almost three years against its major peers, maintaining a momentum on Friday as Donald Trump imposed new tariff rates on dozens of trading partners,” said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
Brent oil prices fell 0.97 per cent to $72.53 per barrel as traders digested the impact of new, higher US tariffs that may curtail economic activity and lower global fuel demand.
“On Thursday, the rupee made a low of 87.75 but closed at 87.5950 as RBI stepped in to cool off the market,” Bhansali said.
“The Indian rupee, if protected by the Reserve Bank of India (RBI), may soon see levels of 87.00 in the days to come, but needs a close watch and on RBI’s presence to keep it in a tightish range,” he said.
In the domestic equity market, Sensex declined 145.71 points or 0.18 per cent to 81,039.87, while Nifty fell 64.70 points or 0.26 per cent to 24,703.65.
Foreign institutional investors (FIIs) offloaded equities worth ₹5,588.91 crore on a net basis on Thursday, according to exchange data.
On the domestic macroeconomic front, the centre’s fiscal deficit stood at 17.9 per cent of the full-year target at the end of June, according to data released by the Controller General of Accounts (CGA) on Thursday.
It was at 8.4 per cent of the Budget Estimates (BE) of 2024-25 in the first three months of the previous financial year.
In absolute terms, the fiscal deficit, or gap between the government’s expenditure and revenue, was ₹2,80,732 crore in the April-June period of the 2025-26 fiscal year.
Published on August 1, 2025
