Rupee falls 2 paise to close at 85.52 against US dollar
Mumbai (PTI): The rupee consolidated in a narrow range and settled for the day 2 paise lower at 85.52 (provisional) against the US dollar on Wednesday, as the support from positive domestic markets was negated by uncertainty over trade tariffs.
Forex traders said the Indian rupee ended the first trading session of the fiscal year 2025-26 on a flat note over Trump's reciprocal tariffs concerns and foreign fund outflows. A surge in crude oil prices also put pressure on the rupee.
However, positive domestic markets and a weak tone in the US dollar cushioned the downside, forex dealers said.
At the interbank foreign exchange, the rupee opened at 85.65 then touched an intra-day high of 85.50 and a low of 85.73 against the greenback. The unit ended the session at 85.52 (provisional) against the dollar, registering a loss of 2 paise from its previous closing level.
"We expect the rupee to trade with a positive bias on trade tariff uncertainty and worries over rising crude oil prices. However, foreign inflows and positive domestic markets may support rupee at lower levels," said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan.
US President Donald Trump has repeatedly criticised the high tariffs charged by India and other countries on American goods.
He plans to roll out a set of reciprocal tariffs on April 2, which he says will be "Liberation Day" for the US.
On Friday, the rupee appreciated 24 paise to close at 85.50 against the US dollar.
This is the first trading session of the 2025-26 financial year. On April 1, the currency and bond markets were closed on Tuesday for the annual account closing of banks.
On March 31, stock, money, commodity and derivative markets remained closed on account of Eid-Ul-Fitr.
In the financial year 2024-25, the rupee depreciated more than 2 per cent. On April 2, 2024, it was quoted at 83.42 against the US dollar.
In March this year, the local unit appreciated 2.17 per cent, the maximum since November 2018 when the local unit had registered a gain of over 5 per cent.
The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.12 per cent lower at 104.13.
Brent crude, the global oil benchmark, fell 0.12 per cent to USD 74.40 per barrel in futures trade.
In the domestic equity market, the 30-share BSE Sensex rose 592.93 points, or 0.78 per cent, to close at 76,617.44, while the Nifty advanced 166.65 points, or 0.72 per cent, to settle at 23,332.35 points.
Foreign institutional investors (FIIs) turned sellers and offloaded equities worth Rs 5,901.63 crore on a net basis on Tuesday, according to exchange data.
Meanwhile, India's manufacturing sector growth rose to an eight-month high in March, driven by quicker increases in factory orders and production amid buoyant demand conditions, a monthly survey said on Wednesday.
The seasonally adjusted HSBC India Manufacturing Purchasing Managers' Index(PMI) was at 58.1 in March, up from 56.3 in February.
On Friday, the Reserve Bank of India said the country's forex reserves jumped USD 4.529 billion to USD 658.8 billion during the week ended March 21.
In the previous reporting week, the overall reserves had increased USD 305 million to USD 654.271 billion.
This is the third consecutive week of rise in the kitty, which has been on a declining trend recently due to revaluation, along with forex market interventions by the RBI to help reduce volatilities in the rupee.
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'Last rites' of INDIA bloc: BJP on Cong-DMK fallout in Tamil Nadu
New Delhi (PTI): The BJP on Wednesday took a swipe at the Congress for extending support to Vijay's TVK in forming the government in Tamil Nadu and breaking away from its long term ally DMK, saying the party has a history of "betraying" its allies.
The saffron party also attacked the opposition INDIA bloc, claiming the alliance is "falling apart like a pack of cards" and lacks any common ideology or vision.
The Tamil Nadu Congress has decided to support TVK leader Vijay in forming a secular government in the state, sources said.
The decision to support the TVK was taken at an urgent meeting of the Political Affairs Committee (PAC) of Tamil Nadu Congress late on Tuesday night.
Reacting to the development, BJP national spokesperson Shehzad Poonawalla claimed the INDIA alliance had effectively come to an end after the declaration of assembly election results on May 4.
"There is nobody whom the Congress has not deceived. Imagine what they will do to the Samajwadi Party if they have done this to the DMK," he wrote in a post on X.
Calling it the "last rites" of the INDIA bloc, Poonawalla, in a video post, said, "It has become a Bharat free of the DMK, TMC and the Left, and now Congress has dumped the DMK for the TVK."
The BJP spokesperson alleged that the opposition bloc was formed solely out of political compulsions and personal ambitions.
"The INDI alliance never had any mission or vision. It was only about ambition for position, corruption, commission and obsession against Modi ji that they came together. But now it is all falling apart like a pack of cards," he said.
Questioning the unity of the opposition parties, Poonawalla said the alliance was absent in several states during the election.
"Where was the INDI alliance in Bengal, in Kerala, in Gujarat, in Punjab, in Delhi, in Haryana, in Karnataka? There is no INDI alliance," he said.
The DMK on Wednesday described the Congress move to extend support to TVK as a "backstab" by its long-time national ally.
Speaking to PTI videos, DMK spokesperson Saravanan Anadurai said, "The Congress party has decided to ally with the TVK, pledging their support to the party. I think they have backstabbed... They have backstabbed the people of Tamil Nadu. They've backstabbed the mandate given by the people of Tamil Nadu."
He said that the decision came even before the electoral process had fully concluded.
"Even before the ink on the returning officer's signature on the victory certificate dried up, they've chosen to go ahead with an alliance," he said.
Vijay's TVK won 108 seats in the 234-member Tamil Nadu Assembly, falling short of the halfway mark. He needs the support of 10 MLAs to form a government with a simple majority. The results were declared only on Monday.
The Congress has won five seats, while the Pattali Makkal Katchi (PMK) has bagged four seats. The CPI and CPI-M have two seats each. The outgoing ruling party, Dravida Munnetra Kazhagam (DMK), has won 59 seats while the All India Anna Dravida Munnetra Kazhagam (AIADMK) has won 47 seats.
The Bharatiya Janata Party (BJP) has won only one seat, and so have the Desiya Murpokku Dravida Kazhagam (DMDK) and the Amma Makkal Munnettra Kazagam (AMMK), while the VCK has won two seats.
The Congress had fought the assembly polls in a pre-poll alliance with the DMK, while the BJP had a tie-up with the AIADMK.
