Indian rupee slides as tariff woes, outflows blunt impact of RBI intervention

MUMBAI: The Indian rupee ended lower on Thursday after a choppy session as fresh, surprise intervention by the Reserve Bank of India was outweighed by tariff worries and equity outflows.

The currency, which opened at 89.95 rebounded to 89.75 after RBI intervened for a second straight day, bankers said. It finally ended at 90.0175 after closing at 89.88 on Wednesday.

“Market moves have again started to be dominated by one large player, and the currency changes direction based on the presence or absence of RBI,” a trader with a foreign bank said.

Earlier in the day, bankers had said they doubted the sustainability of the recovery in the rupee to 89.75 from 90.30, hit on Tuesday and were advising importer clients to hedge on the rupee’s strength.

“The combined effect of 500% tariffs proposed by U.S., fall in equity markets, RBI short forward positions kept the pressure on the rupee consistently even though RBI came intermittently to sell dollars,” said Anil Bhansali, head of treasury at Finrex Treasury Advisors.

“The Indian rupee premiums again have started to move up as importers bought and paid for forward positions of their import holdings.”

Equity markets tumbled for the fourth straight day and, with the Nifty 50 Index dropping 1% amid foreign outflows due to intensifying U.S. tariff worries and selloff in export-oriented firms.

U.S. President Donald Trump will allow a bipartisan sanctions bill targeting countries doing business with Russia to move forward in Congress and it could be put to a vote as early as next week, Republican Senator Lindsey Graham said on Wednesday.

Immediate attention will be on the closely watched U.S. non-farm payrolls report, due after Indian market hours on Friday. The data is expected to offer fresh clues on the labour market and the Federal Reserve’s policy path for 2026.