India-US Tariff War: Rupee 'bleeding' due to Trump tariff, currency reached all-time low

India-US Tariff War: The effect of 50% tariff imposed by the US on India is now clearly visible in the foreign exchange market. On Thursday, the rupee fell to 88.44 against the dollar, which is even lower than last Friday's record of 88.36. This decline shows that Asia's third largest economy is struggling with the pressure of America.

Due to the loss of investors' confidence, foreign investors have withdrawn about $ 11.7 billion from the Indian stock and bond market so far this year. Its direct impact is visible on the currency market. Experts say that the US tariff has had a negative impact on India's growth rate and trade balance, due to which the rupee is being affected the most among Asian currencies.

Government's steps

To handle the situation, the central government has announced a cut in GST rates, so that domestic demand can be supported. Apart from this, talks are going on continuously between India and America, so that trade obstacles can be removed. However, exporters are facing uncertainty of orders and importers are having to increase the cost of hedging, which is disturbing the balance of demand and supply.

RBI's activism

The Reserve Bank of India is also active to stop the weakness of the rupee. Market experts say that the RBI is trying to bring stability in the market by selling dollars. However, the central bank is not trying to stop the rupee at any particular level, but is insisting on controlling the sharp decline, so that panic does not spread among investors and companies.