The Indian rupee edged up to around 87.77 per USD, after the Reserve Bank kept its key policy rate unchanged, as expected, and maintained a "neutral" stance. This followed a surprise 50bps rate cut in June. Governor Sanjay Malhotra noted ongoing global trade challenges but said India’s economic outlook remains "bright." Meanwhile, U.S. President Trump vowed to impose higher tariffs on India within 24 hours over its purchase of “massive amounts of Russian oil,” accusing the country of reselling it “on the open market for big profits.” The tariff hike is set to begin August 1. Still, reports suggest India may offer the US “zero tariffs” in a potential trade deal, which could help ease tensions and support sentiment around the rupee. On the domestic front, the RBI cut its inflation forecast to 3.1% from 3.7%, keeping it comfortably within its 2–6% target, while GDP growth projections were left unchanged at 6.5% for FY2025/26 and 6.6% for the following year.