Rupee Rebounds 14 Paise to 87.66 After Record Fall; RBI Steps In Amid Trump Tariff Jolt

Mumbai – India’s currency witnessed a partial recovery in early trade on Thursday as the rupee rose 14 paise to 87.66 against the U.S. dollar, after tumbling to a historic low of 87.80 the previous day. The rebound came amid suspected intervention by the Reserve Bank of India (RBI) following a steep 89-paise fall—marking the sharpest single-day drop in over three years.

The correction followed global market jitters triggered by U.S. President Donald Trump’s new 25% tariff on Indian imports, announced after stalled trade negotiations. The U.S. also imposed penalties for Indian crude oil purchases from Russia, further pressuring the rupee.

At the interbank foreign exchange market, the rupee opened at 87.66 and briefly dipped to 87.74 in early trade. Forex analysts noted that despite the minor recovery, the rupee still trades with a negative bias, weighed by geopolitical tensions and increasing dollar demand from oil companies.

“The rupee, already down over 3% this year from its April high of 83.75, remains vulnerable after Trump’s aggressive trade and sanctions stance,” said Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP.

On the global front, the U.S. dollar index eased slightly by 0.03% to 99.78, while Brent crude slipped 0.19% to $73.10 per barrel. However, with the U.S. Federal Reserve holding interest rates steady and showing no signs of near-term cuts, the greenback has retained strength throughout July.

Bhansali added that while RBI intervention has offered momentary support, sustained volatility is expected. “Oil companies are rushing to buy dollars ahead of the new Russia tariff window. Unless the RBI intensifies its support, the rupee may continue facing downward pressure,” he said.