Rupee falls 7 paise to 85.83 against U.S. dollar in early trade

Rupee weakens as oil prices rise, dollar falls, and investors await RBI rate decision amid global market volatility.

The rupee stayed on a sliding track and depreciated 7 paise to 85.83 against the U.S. dollar in early trade on Tuesday (April 8, 2025) due to massive withdrawal of foreign funds amid global economic turbulence triggered by the escalated tariff war.

“A recovery in crude oil prices pulled the domestic currency further down even as it found some cushion due to a weaker American currency and strong recovery in the domestic equity markets,” forex traders said.

The global markets have been facing extreme volatility following a fresh threat by the U.S. administration to impose a punitive 50% tariff against China’s retaliatory 34% import levies on American products, they said, adding at the same time the domestic investors are keenly awaiting Reserve Bank of India’s interest rate decision.

The RBI’s monetary policy committee headed by Governor Sanjay Malhotra began its three-day deliberations on key interest rates on Monday (April 7, 2025). The decision is scheduled to be announced on Wednesday (April 9, 2025).

At the interbank foreign exchange, the rupee opened at 85.89 and strengthened slightly to trade at 85.83 against the greenback during initial deals, 7 paise lower than its previous closing level.

The rupee settled 32 paise lower at 85.76 against the U.S. dollar on Monday (April 7, 2025) after losing 14 paise in the preceding session on Friday (April 4, 2025).

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.23% lower at 102.73.