Rupee opens 20 paise down at 85.90 against dollar on Trump's new tariff threats

Indian Rupee

The rupee opened 20 paise down on July 9 as US President Donald Trump has doubled down on his tariff threats, including a 10 percent tariff on BRICS countries and their partners. India is a founding member of BRICS.

The currency opened at 85.90 against the US dollar after ending the previous session at 85.70.

The dollar index was at 97.691 in the early trade. It closed the previous day at 97.516.

Trump said that he plans to set a 50 percent tariff on copper imports, while threatening a much higher rate on pharmaceuticals that would kick in after at least a year.

"Today we're doing copper," he told a cabinet meeting, indicating progress in an ongoing probe into imports of the metal.

He threatened to levy 200 percent tariff on all pharmaceutical imports.

He said pharmaceutical manufacturers would be given time to relocate their operations to the United States before rolling out fresh duties. "We're going to give people about a year, a year and a half to come in, and after that, they're going to be tariffed," Trump said.

"They're going to be tariffed at a very, very high rate, like 200 percent," he added. "We'll give them a certain period of time to get their act together."

His move on pharma is likely to hurt India, as it is a key export for the country.

The US accounts for nearly a third of India's pharma exports, which rose 16 percent to about $9 billion in the last fiscal year, a Reuters report cited government-backed trade body Pharmexcil as saying.

"The rupee may trade within 85.50 to 86 range, with the rupee in a consolidation mode. Dollar can be sold off near 86 levels, while it can be bought at below 85.50 levels if we could get the Indi-US deal done," said Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.