Rupee watch: Currency slips to 89.94 against dollar; crude rise, FII outflows and tariff worries weigh

The rupee weakened by 7 paise to close at 89.94 (provisional) against the US dollar on Thursday, pressured by higher crude oil prices, sustained foreign fund outflows and a firmer greenback, PTI reported.Forex traders said the local unit also faced headwinds from renewed concerns over potential US tariff action and weak sentiment in domestic equities. At the interbank foreign exchange, the rupee opened at 89.96 and moved between an intra-day low of 90.13 and a high of 89.73 before settling lower on the day.“India faces big trouble on its exports if the US increases tariffs by even 10 bps, as sentimentally it changes from ‘the deal in pipeline’ to ‘back to square one’. RBI shorts in the markets will keep the dollar buying sentiment,” Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, told PTI. He said the rupee is expected to trade in the 89.80–90.30 range on Friday.The dollar index, which measures the greenback against a basket of six major currencies, was marginally higher at 98.70. Brent crude, the global oil benchmark, rose 0.85% to $60.47 per barrel in futures trade.On the domestic equity front, benchmarks closed sharply lower, with the Sensex tumbling 780.18 points to 84,180.9 and the Nifty falling 263.90 points to 25,876.85. Foreign institutional investors sold equities worth Rs 1,527.71 crore on Wednesday, exchange data showed.Meanwhile, the government projected GDP growth at 7.4% for the current fiscal year in its latest estimates, retaining India’s position as the world’s fastest-growing major economy despite geopolitical tensions and the overhang of punitive US tariffs.