Rupee falls 7 paise to close at 85.40 against U.S. dollar

Geopolitical tensions and market sentiment weigh on rupee as traders eye US dollar index and domestic equities.

The rupee pared its initial gains and settled for the day lower by 7 paise at 85.40 against the U.S. dollar on Friday (April 25, 2025), amid heightened geopolitical tensions and a negative trend in the domestic markets.

Forex traders said escalated geopolitical tensions, following a terror attack in Pahalgam, Jammu and Kashmir, weighed on market sentiment.

Moreover, a muted trend in domestic equities and positive US dollar index dented investors' sentiment further.

At the interbank foreign exchange, the domestic unit opened at 85.17 and moved between the intra-day high of 85.08 and the low of 85.65 against the greenback. The unit ended the session at 85.40 (provisional), registering a fall of 7 paise over its previous closing level.

On Thursday, the rupee gained 12 paise to close at 85.33 against the U.S. dollar.

"We expect the rupee to trade with a negative bias amid heightened geopolitical tensions and weak tone in the domestic markets. However, persistent FII inflows, overall weakness in the U.S. dollar may prevent a sharp fall in the rupee. USD-INR spot price is expected to trade in a range of 85 to 85.90," said Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan.

On Tuesday, at least 26 persons — mostly tourists — were killed by terrorists at the Baisaran meadows in Pahalgam in one of the worst terror attacks on civilians in Kashmir in the past many years.