Rupee hits a new low of ₹88.09 responding to additional tariffs

Rupee hits a new low of ₹88.09 responding to additional tariffs

The Indian rupee fell 0.58% to 288.09. against the US dol lar on Thursday respond ing to the additional tariffs imposed by the United States. The domestic cur rency may depreciate further in the range of 89.5-290 against the dol lar in the coming weeks, analysts said.

Currency dealers react ed two days after the U.S's tariffs on Indian goods kicked in before selling off the rupee Anindya Ban nerjee, Currency and Com modities Head of Kotak curities said that dealers were waiting to see if the central bank would step in and control the volatility

"Once they realised RBI didn't, they started to sell off the rupee." The rupee depreciates when foreign exchange traders sell and

Chain reaction: A further increase in exports over imports may also quicken the pace of depreciation. REUTERS

Setool in the war" appreciates when they buy. He added that the RBI may not have intervened because "when there is a trade war, everything is a

"The RBI also wants the rupee to weaken so as to offset the impact of the higher tariffs, to make the exports more competi tive," said Maneesh Shar ma, who heads the Com modities and Currencies Research at Anand Rathi

Shares and Stock Brokers.

A depreciating currency would naturally make ex ports cheaper, as the value of goods that the U.S. would buy for a dollar from India would become cheaper A further increase in exports over imports may also quicken the pace of depreciation.

Both analysts expect that RBI to step in if the ru pee crosses 189.5 against the green back.

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