Outlook Steady Amid Tariff Turmoil

Experts peg rupee at 85.50 against dollar by June; RBI expected to boost dollar purchases

- ANJALI KUMARI

With Donald Trump's reciprocal tariff policy raising concerns over US growth prospects and weakening the dollar, the rupee is expected to remain stable over the next few months, allowing the Indian central bank to shore up its foreign exchange (forex) reserves.

After touching record lows multiple times between December and February, the Indian unit made a sharp recovery from March onwards, gaining 0.44 per cent so far in 2025 against the dollar.

According to the median estimate from a Business Standard poll, the rupee is expected to trade at 85.5 per dollar by June-end, and 85.75 by September-end. The Indian unit closed at 85.24 per dollar on Friday, compared to its previous close of 85.44.

"A much more muted pace of rupee depreciation is likely, as dollar weakness is expected to persist amid weakening US growth. The reciprocal tariffs announced by President Trump were far steeper than expected and not tied to tariff differentials," said Gaura Sen Gupta, chief economist at IDFC First Bank.