- Indian Rupee (INR) falls, extending last week’s declines.
- Trump threatens additional tariffs for Russian oil buying
- The US Dollar (USD) is falling versus major peers
- USD pares earlier gains as investors look past the US intervention in Venezuela
The US dollar-to-Indian rupee (USD/INR) exchange rate is rising, extending gains from last week. The pair rose 0.24% in the previous week, settling on Friday at 90.01. At 18:30 UTC on Monday, the pair is rising 0.18% at 91.17.
The Indian Rupee has declined following President Trump’s threat to increase tariffs on imports from India. Trump warned that he could lift tariffs on Indian imports if India continued to purchase Russian oil.
The threat follows Trump raising tariffs to 50% on Indian imports, including a 25% tariff on Russian oil.
Trade tensions have led to a significant increase in demand for the US dollar by Indian importers, and foreign funds have been withdrawing from the Indian stock market.
In 2025, Foreign Institutional Investors FIIs sold R 3,06,418.88 crore worth of Indian stocks.
Looking ahead, Indian GDP data is due this week and comes as India overtakes Japan to become the fourth-largest global economy.
The US Dollar is appreciating against the Rupee but depreciating against its major peers. The US Dollar Index, which measures the US dollar against a basket of major currencies, is down 0.11% to 98.31, following gains last week.
The U.S. dollar is falling, giving back early gains as investors look past events in Venezuela following the US raid to capture Venezuelan President Nicolas Maduro. Trump threatened another attack on Venezuela if the country didn’t cooperate with US efforts to open up its oil industry and stop drug trafficking. Trump also threatened military action in Colombia and Mexico.
After initial gains on safe-haven demand, the US dollar has since fallen away from a four-week high.
Attention is now turning to U.S. data, with the monthly nonfarm payrolls report due on Friday, which will be key to shaping expectations for the interest rate outlook.
Today, U.S. manufacturing activity contracted more than expected in December, extending its slump to 10 consecutive months as new orders fell and input costs continued to rise due to Trump’s import tariffs.
