Global Trade Tensions Impact Rupee and Equity Markets

The rupee fell 19 paise against the US dollar amid global trade tensions and market volatility triggered by US tariffs and China's retaliation. Crude prices' decline and weaker American currency couldn't support the rupee, with investors awaiting the Reserve Bank of India's monetary policy decision on interest rates.

The Indian rupee took a hit on Monday, declining 19 paise to 85.63 against the US dollar. This downward trend stems from ongoing global trade tensions, notably sparked by US tariffs and China's retaliatory measures, which have sent equity markets into turmoil worldwide.

Forex traders point to a notable decrease in crude oil prices and a weaker US dollar as insufficient to cushion the rupee's downfall. Despite these factors, persistent foreign fund outflows align with global market sell-offs, adding pressure to the domestic currency.

Market analysts keenly await the Reserve Bank of India's monetary policy committee's decision on interest rates, with deliberations already in progress. Additionally, foreign institutional investors offloaded equities worth Rs 3,483.98 crore as concerns over a global trade war grew.

(With inputs from agencies.)