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Gold goes up, rupee weakens after Trump's new tariff move as India awaits US trade deal
At the interbank foreign exchange, Indian rupee slipped 19 paise to 85.89 against US dollar in early Friday trade
Gold prices edged higher on Friday following fresh US tariffs imposed by American President Donald Trump, but a stronger dollar limited the precious metal's upside.
Spot gold was up 0.3% at $3,332.73 per ounce as of 0423 GMT, while US gold futures climbed 0.5% to $3,343.70.
At the interbank foreign exchange, meanwhile, Indian rupee slipped 19 paise to 85.89 against US dollar in early Friday trade.
The fresh disturbances came after Trump announced a 35% tariff on imports from Canada and signaled additional duties of 15% to 20% on most other trading partners.
The latest measures follow Wednesday’s imposition of a 50% tariff on copper imports and similar levies on goods from Brazil, along with tariff notifications to countries including Japan and South Korea. All new duties are scheduled to take effect on August 1.
“Despite Trump's tariff wars picking up steam again, gold hasn't gotten the boost it previously has because investors are becoming more accustomed to both the tariff story and Trump's policy-making style,” news agency Reuters quotes Tim Waterer, Chief Market Analyst at KCM Trade, as saying.
Other precious metals saw mixed movement: silver rose 0.4% to $37.19 per ounce, platinum slipped 0.3% to $1,357.18, and palladium edged 0.1% higher to $1,142.70.
However, a firmer US dollar kept gains in check. The dollar index is on pace for its best weekly performance since late February, making gold more expensive for holders of other currencies.
Rupee falls 19 paise to 85.89 against US dollar in early trade
The Indian rupee weakened by 19 paise to ₹85.89 against the US dollar in early trade on Friday, amid dampened investor sentiment following Trump’s announcement for Canada.
The domestic currency opened at 85.76 at the interbank foreign exchange market and soon slipped to an early low of 85.89, compared to its previous close of 85.70.
On Thursday, the rupee had ended 3 paise higher after recovering from early losses. However, the renewed global trade tensions have added pressure on emerging market currencies.
"Such moves raise inflationary risk — ironically pushing rate cuts even further out of reach. And while India has so far escaped direct tariff action, the broad-based nature of Trump’s tariff crusade has markets on edge," Amit Pabari, managing director at CR Forex Advisors, told news agency PTI.
India trying to finalise trade deal by Sept-Oct
India is working to conclude a trade agreement with the United States, with efforts underway to finalise an interim deal by September or October, according to a senior commerce ministry official cited by PTI.
Rajesh Agrawal, special secretary in the department of commerce and chief negotiator of the proposed India-US bilateral trade pact, confirmed on Thursday that talks are progressing.
An official said a delegation from the Indian commerce ministry will soon travel to Washington for the next round of discussions to resolve outstanding issues in key sectors such as agriculture and automobiles.
"We are not differentiating between an interim or the first phase of the bilateral trade agreement. We are negotiating a complete deal. Whatever will be finished, we can package it as an interim deal and for the rest, talks will continue," the official said.
(With Reuters, PTI inputs)
