Indian Rupee Falls To More Than 5-month Low Against U.S. Dollar

(RTTNews) - The Indian rupee weakened against the U.S. dollar in the European session on Tuesday, after U.S. President Donald Trump indicates an increased import duty rate for India.

Trump has threatened India with tariffs as high as 25 percent but cautioned the final levy had still not been finalized.

Separately, media reports said, citing sources familiar with the matter that Trump has expressed his desire to speak with Prime Minister Narendra Modi before giving the final nod to the long-anticipated India-U.S. trade agreement.

Mr. Modi is currently engaged in the Monsoon session of Parliament, and the two governments are coordinating the logistics of a potential call, it was said.

Investors are anticipating the Federal Reserve's decision regarding monetary policy, as well as significant economic data from the United States.

Against the U.S. dollar, the rupee fell to more than a 5-month low of 87.53 from an early high of 87.06. At yesterday's close, the rupee was trading at 87.11 against the greenback.

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

Looking ahead, U.S. MBA mortgage approvals data, U.S. ADP jobs data, U.S. GDP data for the second quarter, U.S. PCE prices for the second quarter, U.S. pending home sales data for June and U.S. EIA crude oil data are slated for release in the New York session.

At 9:45 am ET, the Bank of Canada is set to announce interest rate decision. The central bank is widely expected to hold its policy rate steady at 2.75 percent.

Following the policy announcement, the BoC Governor Tiff Macklem will speak in a press conference.

At 2:00 pm ET, the U.S. Federal Reserve will announce its monetary policy decision. The Fed is expected to leave interest rates steady in the range of 4.25%-4.50%.

Half-an-hour later, the Federal Reserve Chair Jerome Powell will hold a press conference following the central bank's decision on interest rates.