On the final trading day of the current fiscal year 2025, the Indian rupee opened stronger against the dollar as foreign inflows resumed, limiting the rise in dollar and crude oil prices. Bloomberg data show that the domestic currency opened 7 paise higher at 85.71 against the greenback, up from 85.79 on Thursday.
So far in March, the currency has risen by 2.13 percent, mirroring the decline in the dollar index. Meanwhile, during the current fiscal year, it fell 2.6%. The Indian rupee fell on Thursday due to rising global uncertainty and strong month-end dollar demand from importers, according to Amit Pabari, managing director of CR Forex Advisors.
"The currency's slide was worsened by escalating trade tensions and a rally in crude oil prices." Given India's reliance on oil imports, the rise in crude prices heightened concerns about the country's trade deficit, putting additional pressure on the rupee.
Furthermore, stronger-than-expected US GDP growth of 2.4% boosted the dollar index, increasing downward pressure on the rupee.
The dollar rose to a three-week high after Trump announced auto tariffs on Thursday. The dollar index, which measures the value of the US dollar against a basket of foreign currencies, was down 0.07 percent at 104.26. The dollar index fell 3.26 percent in March, reaching its highest level since November 2022.
