FX.co ★ Rupee Rises on Trade Talks, GDP Outlook

The Indian rupee appreciated to approximately 90.1 per dollar, rebounding from losses observed in the previous session amidst ongoing trade negotiations and the latest forecasts for GDP. Market sentiment remained cautious as India prepared for upcoming trade discussions with the United States. On Tuesday, External Affairs Minister Jaishankar engaged in talks with US Secretary of State Rubio, covering topics such as trade, critical minerals, nuclear energy, defense, and energy. While bilateral trade deal negotiations continue, progress remains sluggish due to American demands regarding India’s agricultural and dairy sectors. Concerns were alleviated after government sources indicated that the newly announced 25% tariff would have minimal effect on India, as trade with Iran constitutes only about 0.15% of the nation’s total trade volume. Meanwhile, the World Bank maintained its GDP growth forecast for India at 6.5% for the fiscal year 2026-27, suggesting a deceleration from the projected 7.2% growth for the current fiscal year, assuming the United States retains a 50% tariff on certain imports.