Indian Rupee resumed its bull run and maintained the third straight day of gains on Thursday by settling 3 paise up at 85.65 per US dollar. A report by a news agency states that the minor rise was despite the worsening trade tensions across the world, mainly due to the new tariffs imposed on various trading countries by former US President Donald Trump.
This year in current terms, the rupee has already lost 0.15 per cent against the greenback and 0.03 per cent against the calendar. Thursday’s rise, however, mirrors the general growth that was experienced in the Asian currencies, whereby many of them also rose as apprehension lowered about imminent rate increases by the US Federal Reserve.
Again, the forceful trade policy adopted by Trump has startled the international markets. Single-handedly, the US imposed a 50 per cent import tax on Brazilian products, in addition to 30 per cent tariffs on goods importation by Algeria, Libya, and Iraq, referred to as the quadrilling on Wednesday alone. The import duty in Sri Lanka was 25 per cent. To further worsen the mood of the globe in trading, Trump has declared a 50 per cent tariff on copper imports, which was to have been imposed on August 1st, a move that will affect industrial commodity flows and possibly the global supply chain.
In the meantime, the latest US Federal Reserve meeting minutes provided relief to the world investors. There are price pressures attributed to tariffs, which, according to the Fed, will not negatively impact the likelihood of interest rate reductions in the near term. The Fed stated that the main issue is inflation, but it will continue to monitor it and make appropriate decisions. Consequently, the US dollar index, or measurement of the greenback relative to a basket of six leading currencies, declined by 0.17 per cent to 97.41.
Crude oil prices declined in commodities due to fears of a slower global growth and rising tariffs. Brent crude decreased by 0.28 per cent, to end at 69.99 dollars per barrel, whereas WTI crude dropped by 0.48 per cent to reach 68.05 dollars per barrel at 3.40 PM IST, as there is a vague outlook in the future of energy demand.
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