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The Indian Rupee falls to a fresh record low in Monday’s Asian session.  The strengthening USD and persistent outflows weigh on the INR.  Investors await the US January ISM Manufacturing PMI report, which is due on Monday.  The Indian Rupee (INR) tumbles on Monday. Trump’s announcement of the imposition of tariffs on major trading partners including China, Canada, and Mexico exert some selling pressure on the local currency. Additionally, the stronger US Dollar (USD), persistent foreign institutional investors (FIIs) outflows, and risk-off sentiment contribute to the INR’s downside.  On the other hand, the foreign exchange intervention from the Reserve Bank of India (RBI) should defend the Rupee and cap its downside. Later on Monday, traders will keep an eye on the US ISM Manufacturing PMI for January.  Indian Rupee remains under selling pressure amid fears of a trade war India’s foreign exchange reserves were down to $629.557 billion as of January 30, 2024, from $701.176 billion on October 4, 2024. Finance Minister Nirmala Sitharaman said in the budget on Friday that the Indian government will target a narrower fiscal deficit of 4.4% of Gross Domestic Product (GDP) for fiscal year 2025-26, down from a revised 4.8% for the current year.  The government increased gross borrowing to 14.82 trillion rupees ($171.26 billion) from the market to fund the deficit, compared with 14.01 trillion rupees in the current year. The White House said on Saturday that a levy of 25% on Canadian and Mexican imports as well as an additional 10% tax on Chinese goods would come into force on Tuesday. Canada, Mexico and China have vowed to respond to sweeping new tariffs on their exports to the US announced by Trump. “Tariff announcement is necessary to hold China, Mexico, and Canada accountable for their promises to halt the flood of poisonous…

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Filed under: News - @ February 3, 2025 3:25 am