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Rupee Tumbles Amid India-US Trade Deal Jitters
9 Feb
Summary
- Rupee fell 9 paise to 90.74 against the US dollar on Monday.
- India and US agreed on an interim trade framework to boost trade.
- Forex reserves hit a new all-time high of USD 723.774 billion.
The Indian rupee faced significant volatility, concluding Monday's trading session down by 9 paise to settle at 90.74 against the US dollar. Market participants closely examined the newly established India-US interim trade framework. This agreement entails mutual reductions in import duties, intended to stimulate two-way trade between the nations.
The framework details India's intention to reduce duties on a wide array of US industrial and agricultural products. Concurrently, India plans to purchase substantial amounts of US energy products, aircraft, and other goods over the next five years. Despite a surge in domestic equities and foreign investments, the rupee's gains were eroded by prevailing risk-off market sentiment.
In separate positive news, India's foreign exchange reserves have reached an unprecedented all-time high of USD 723.774 billion as of the week ending January 30. This marks a significant increase, underscoring the country's robust financial standing.
