Indian rupee depreciated on Wednesday amid escalating tariff turbulence globally even as the Reserve Bank reduced key interest rate by 25 basis points as a growth-stimulus measure. The rupee extended its losing streak for the fourth straight session. Traders were cautious as the Reserve Bank of India (RBI) said the global economic outlook is facing new challenges due to recent trade tariff announcements. These developments have caused sharp falls in the dollar index, equity markets, and crude oil prices. The RBI added that this uncertainty is a fresh risk to both global and Indian growth. The RBI’s rate setting Monetary Policy Committee cut India’s GDP growth forecast for this fiscal year (FY26) to 6.5% from 6.7% growth projected earlier. On the global front, U.S. dollar weakened against other major currencies in the European session on Wednesday, amid speculation that the U.S. Federal Reserve may need to speed up rate cuts and also on fears of a potential U.S. recession.
Finally, the rupee ended at 86.73 (Provisional), depreciated by 47 paise from its previous close of 86.26 on Tuesday. The currency touched a high and low of 86.76 and 86.47 respectively.
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