Dollar Dominance

Market focus remains on trade tensions. In his latest warning to Canada, US President Donald Trump said on Friday that reciprocal tariffs on dairy and lumber could be imminent

Concerns about the US growth outlook alongside uncertainty about the growth-inflation impact of trade tariffs have weighed on the dollar and US bond yields over recent sessions

China's retaliatory tariffs on some US exports are due to take effect on Monday, with no sign as yet of progress between Beijing and Washington

The dollar index was last down 0.67 per cent on the day at 107.42. It reached 110.17 on Jan. 13, the highest since November 2022

US President Donald Trump warned BRICS nations, stating that countries pursuing de-dollarisation efforts will face a 100 per cent tariff on trade with the United States

Volumes were light with holiday for New Year looming and Japan on holiday for the rest of the week, with the Santa-rally losing some steam as elevated Treasury yields weigh on high equity valuations

The rupee had settled at Rs 85.07 per dollar on Thursday

Dollar index, which measures the US currency against six rivals, was steady at 106.77 and on course for 5 per cent gain for the year

If Trump wants to maintain the dollar's primacy, he should recognise that its value is not dependent on American power and threats, but on American reliability

While dollar-rupee forward premiums rose on Thursday in reaction to the heightened odds of a Fed rate cut and on the back of an elevated USD/INR overnight swap rate, they were pegged by the central

He also mentioned that the idea of a currency for BRICS countries was floated by one of the countries; however, no decision has been made on the matter

RBI Governor Shaktikanta Das explained India's stand on de-dollarisation after US president-elect Donald Trump's warning to Brics nations

The rupee fell 2 paise to trade at 84.49 against the US dollar in early trade on Friday dragged down by significant foreign fund outflows and month-end dollar demand from importers. Forex traders said the rupee remains in a weakening mode due to dollar demand from importers and foreign banks. At the interbank foreign exchange, the rupee opened at 84.49 against the greenback, registering a fall of 2 paise over its previous close. On Thursday, the rupee depreciated 7 paise to close at 84.47 against US dollar. As FPIs sold Rs 11,000 crore of shares on Thursday Indian rupee was constantly on the selling side against the US dollar which surged to its highest at 84.51 before closing at 84.4850 with the Reserve Bank of India (RBI) protecting any fall beyond 84.50 for now, Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP said. "Good month-end demand for US dollar and FPIs buying it kept dollar well bid near to 84.50. Expect the buying to continue o

Dollar jumped more than 2.5 per cent against the peso to its highest since July 2022 in New York afternoon trade

Market participants flagged that the sensitivity of the euro to the threat of higher U.S. import tariffs was evident late Friday.

"Gold will be torn between the risk of rising inflation, potentially slowing the pace of US rate cuts, as tariffs are rolled out and continued demand for safe haven assets," said Ole Hansen, head

The rupee stayed almost flat, trading 1 paisa higher at 84.07 against the US dollar in early trade on Wednesday, dragged down by strengthening American currency and relentless outflow of foreign funds. Forex traders said a downward trend in domestic equity markets and elevated level of crude oil prices prevented a recovery in the Indian currency. At the interbank foreign exchange, the rupee opened 1 paisa higher at 84.07 against the greenback and traded on a flat note in early deals. On Tuesday, the rupee settled 1 paisa lower at 84.08 against the US dollar. The local currency has been struggling to recover since October 11, when it closed at its lowest level of 84.10 against the dollar. According to analysts, the rupee has been under pressure due to the continuous selling of Indian equities by FIIs in pursuit of better gains from the Chinese market. Also, they said, a surge in the US treasury yields raised concerns that the Federal Reserve may slowdown its rate cut move, steerin

Market participants said timely intervention by RBI through dollar sales helped avoid further depreciation of the local currency

The important question is what if the insurance of higher reserves and stability in currency attracts substantially more capital inflows?

One would hope that a Trump administration would not try to interfere with foreign-exchange markets beyond instituting tariffs