Rupee Opens Higher Against Dollar After CPI Data Release

Mumbai, June 12, 2025 — On Thursday, June 12, 2025, the Indian rupee opened 9 paise stronger against the US dollar, trading at 85.43 compared to its previous close of 85.52. This appreciation reflects a mix of global and domestic economic factors. One of the key reasons is that the weaker-than-expected US Consumer Price Index (CPI) inflation report released yesterday has increased expectations of Federal Reserve rate cuts, putting downward pressure on the dollar.

Furthermore, the pressure on the dollar has increased due to the anticipation that US President Donald Trump may be adopting a softer stance in tariff negotiations within the trade deal with China.

Global Currency Movements:

• The euro strengthened to 1.1513.
• The pound was slightly lower at 1.3577.
• The Japanese Yen gained ground, rising to 144.04.
• Among other Asian currencies, the Chinese Yuan fell to 7.1916, the Indonesian Rupiah was at 16,247, and the South Korean Won was at 1,370.

Crude Oil Gains

• Brent crude, the global benchmark, extended its gains on Thursday, rising 0.24% to $70.01 per barrel. This follows a significant surge of over 5% on Wednesday.
• The rise in oil prices is primarily attributed to rising tensions in the Middle East. The US has ordered some staff to depart from its embassy in Baghdad after Iran threatened to attack US bases if talks over its nuclear program fail.
• This recent spike follows a period of considerable decline in crude prices. Brent crude had slipped below $59 in May, reaching its lowest level since February 2021, and in the last three months, prices had tumbled to a four-year low amidst Trump’s tariff wars.

What’s Ahead?

The rupee may remain steady to slightly firm in the short term, supported by easing US inflation data and hopes of Fed rate cuts. However, global uncertainty over the US-China trade deal and rising oil prices could limit gains. Crude oil prices may remain volatile amid ongoing geopolitical risks in the Middle East. Investors will be cautious and closely watch Fed commentary, US-China trade developments, and oil market updates.

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