The USD/INR gains ground for a bullish dollar and uncertainty about the commercial agreement between the US and India

• Indian rupee opens in a weak tone against the US dollar in the middle of a feeling of the discouraging market.
• The president of the USA, Trump, declared a higher general tariff of 15% -20% on nations that have not reached an agreement.
• The delay in the commercial agreement between the US and India has put Indian rupee in a situation of uncertainty.

Indian rupee (INR) falls against the US dollar (USD) during the European negotiation session on Friday. The USD/INR jumps about 86.00 as the feeling of the market becomes cautious after The president of the United States (USA) Donald Trump considers a higher general tariff for most Washington’s commercial partners.

The US president Trump said in an interview with NBC News On Thursday that it is considering imposing general tariffs of 15% -20% who have failed to close an agreement during the 90-day pause period, higher than 10% announced in the so-called “Liberation Day” on April 2.

“We are simply to say that all the remaining countries are going to pay, either 20% or 15%. We will solve it now,” Trump said.

The possible highest general tariff of President Trump has led to a strong decrease in the demand for more risky assets, such as Indian rupee. However, the US dollar is firmly negotiated near its maximum of two weeks, with The US dollar index (DXY) quoting around 97.90.

The impact of the discouraging market feeling is also visible on Indian actions, which have opened in a weak tone. The NIFTY50 opens 0.3% down 25,300. The Sensex30 falls below 83,000. The damage to the Indian actions is partially caused by the technological giant of India, Tata Consultancy Services (TCS), which has dropped almost 2% after moderate results of the first quarter of fiscal year 2025-2026.

Another reason behind the deterioration of market feeling It is Trump’s warning to send a letter to the European Union (EU), specifying the rates Tariff However, EU officials said this week that they are looking to reach a commercial agreement with Washington before the deadline of August 1. Meanwhile, Trump has imposed 35% tariffs on China, which will be separated from their sectoral taxes, including cars, steel, copper and aluminum.

What moves the market today: Indian rupe

• Indian rupee quotes down in the midst of the uncertainty surrounding the commercial agreement between the US and India. Both nations have not yet confirmed an agreement, even when President Trump said last week that it is expected to close a deal with India in 48 hours.
• However, New Delhi has declared that a team from the Ministry of Commerce will soon go to Washington for another round of negotiations, Times of India (Toi) reported. “We are negotiating a complete agreement. What is finalized can package as a provisional agreement, and conversations on the rest will continue,” said a senior government official.
• The reason behind the delay in the commercial agreement between the US and India seems to be New Delhi’s protectionist policies towards its agricultural and intensive labor sectors, according to an NDTV report.
• Meanwhile, the growing expectations of a fall in the price of oil in the next negotiation sessions due to a greater increase in the projected in oil production by the OPEC+ is expected to support Indian rupee. The currencies of nations that depend largely on oil imports, such as Indian rupee, work well in a lower oil prices environment.
• In the US, investors will change their approach to US Consumer Price Index (CPI) for June, which will be published on Tuesday. Inflation data will demonstrate the impact of sectoral and general tariffs imposed by President Trump. Signs of price pressures accelerating would force operators to reduce bets that support trimming of interest rates by the Federal Reserve (FED) at the September meeting. At the policy meeting later this month, the Fed will surely maintain stable interest rates in the range of 4.25%-4.50%.
• On Wednesday, the minutes of the policy meeting of the Federal Open Market Committee (FOMC) of June 17-18 showed that the members hope that monetary policy adjustments will be appropriate later this year if the inflation driven by tariff turns out to be “modest or temporary.”

Technical analysis: the USD/INR recovers 86.00

The USD/INR jumps at about 86.00 at Friday opening. The pair manages to return above the 20 -day exponential (EMA) mobile average, which is negotiated around 85.90.

The 14-day relative force (RSI) index oscillates within the range of 40.00-60.00, suggesting that the asset lacks impulse in any direction.

Looking down, the minimum of May 27, 85.10 will act as a key support for the torque. On the positive side, the minimum of June 24 at 86.42 will be a critical obstacle to the pair.