Indian Rupee Falls Amid Trump Tariff Threats, Asian Currency Uncertainty

The Indian rupee weakened sharply against the U.S. dollar amid renewed uncertainty over U.S. tariff policies under President Donald Trump, who announced potential tariffs of up to 70% starting August 1 and introduced a new 10% tariff on countries aligned with the "anti-American policies" of BRICS nations. This announcement triggered declines in Asian currencies and equities, with the rupee hitting its lowest levels since mid-June, pressured further by strong dollar demand from local banks and stop-loss triggers. Despite ongoing trade negotiations, including a pending India-U.S. mini trade deal expected to conclude soon, the threat of additional tariffs has unsettled markets and spurred speculation about intervention by the Reserve Bank of India to support the rupee. While Asian currencies broadly weakened, the U.S. dollar index and Treasury yields remained relatively stable, and investors awaited clarity on trade policies and upcoming central bank moves. The broader market impact included a drop in oil prices following an unexpected OPEC+ supply increase, compounding global economic concerns. Overall, the rupee's volatility reflects the heightened geopolitical and trade tensions caused by the evolving U.S. tariff stance toward BRICS countries.