Indian Rupee Falls To More Than 4-week Low On Tariff Worries

(RTTNews) - The Indian rupee weakened against the U.S. dollar in the Asian session on Tuesday, after the Trump administration officially issued a notice regarding the imposition of an additional 25 percent tariffs on Indian imports, with the punitive duties set to kick in at 12:01 am (EST) on August 27.

On the trade front, there seems to be no hopes for tariff relief as the U.S. officials have already cancelled the scheduled visit to India during August 25-29.

India was warned by US President Donald Trump that if it kept purchasing Russian oil, he would punish it with higher charges.

"No matter how much pressure comes, we will keep increasing our strength to withstand it," Prime Minister Modi said at a public rally in Ahmedabad's Nikol area and stressed that his government will never let harm come to small entrepreneurs, farmers, and livestock rearers.

Fitch Ratings said in a statement that the direct impact of higher U.S. tariff on Indian GDP will be modest as exports to the U.S. account for 2 percent of GDP, but tariff uncertainty will dampen business sentiment and investment.

Asian markets traded lower this morning while the dollar and U.S. Treasuries slid after Trump said on social media he was removing Lisa Cook from her position on the Fed's board of directors, the latest in a series of attacks on the central bank's independence.

Trump said there was enough evidence that Cook had made false statements on mortgage applications.

In the Asian trading today, the rupee fell to more than a 4-week low of 87.79 from an early high of 87.58.

If the rupee extends its downtrend, it is likely to find support around the 88.00 region.

Looking ahead, Canada manufacturing sales data for July, U.S. durable goods orders for July, U.S. Redbook report, U.S. S&P/Case-Shiller home price for June, U.S. Consumer Board's consumer confidence for August and U.S. Dallas Fed services index for August is slated for release in the New York session.