The Rupee weakens slightly
US has added India to currency watch list with China. The US has sent out
a disturbing signal that it will do what it takes to curb its $800 billion-plus
trade deficit with the entire world. US has imposed 25 per cent tariff on
China’s steel exports and 10 per cent on its aluminum exports, prompting China
to slap retaliatory tariffs on US food and beverages.
It is clear that the Trump administration is on a mission to carve out a
world trade order to its liking. US president Donald Trump named China, Japan, Germany, Korea and Switzerland
as ‘currency manipulator’.
India has a trade surplus of over $20 billion with the US. The rupee has
been on the rise in 2017, while its trade deficit as a whole has risen in
2017-18 to about $150 billion. US pressure is unlikely to stop here. It is
likely to extend to India’s intellectual property rights, especially with
respect to pharma. India should play its cards carefully,
The US’ inability to bridge its trade deficit points to a productivity
crisis, rather than mere currency games. The US needs to look within, rather than look for scapegoats.
The rupee weakened to 65.69 on fresh dollar demand from importers. Rising
crude prices on the back of widening trade deficit concerns continue to linger
on the rupee. The rupee opened strong at 65.45 at the interbank forex market.
It hovered in a range of 65.69 and 65.40 before ending at 65.64, down 10 paise
at 5 pm local time on 17 April.
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