Why did the Indian rupee become volatile on Monday?

The rupee experienced volatility as traders assessed details of the India-US interim trade framework, with risk-off sentiments negating support from domestic equities and foreign fund inflows.

What is the India-US interim trade framework?

The India-US interim trade framework is an agreement where both nations will reduce import duties on various goods to promote bilateral trade.

What is the current status of India's foreign exchange reserves?

India's foreign exchange reserves have reached a new all-time high, standing at USD 723.774 billion as of the week ending January 30.

Home / Business and Economy / Rupee Tumbles Amid India-US Trade Deal Jitters

Rupee Tumbles Amid India-US Trade Deal Jitters

9 Feb

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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.

Rupee Tumbles Amid India-US Trade Deal Jitters

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.