The Rupee opened weaker on Tuesday after comments from Pakistan's defence minister warning of an imminent military incursion by New Delhi raised concerns about a further increase in tensions between the two neighbours. This comes after a deadly militant attack on tourists in Kashmir last week, for which India has blamed Pakistan. Following the remarks by the Pakistan official late on Monday, the 1-month USD/INR NDF briefly touched 85.50 before pulling back amid a weaker U.S. dollar. The rupee's losses would have been bigger if not for the weaker dollar, a currency trader at a bank said. Headline risk for the domestic unit has increased significantly and that likely means interbank players will lighten up their positions. The rupee and Indian equities rallied on Monday, suggesting that both markets had not priced in a further escalation in India-Pakistan tensions. The dollar index dropped 0.7% on Monday near the 99 mark amid worries over the U.S.-China trade war. U.S. Treasury Secretary Scott Bessent said in an interview that it was up to China to de-escalate on tariffs, adding to a series of conflicting signals on the status of trade negotiations between the world’s largest economies. The dollar barely recouped its heavy losses on Tuesday as investors were no clearer on whether a de-escalation of the Sino-U.S. trade war was underway with Treasury Secretary Scott Bessent suggesting the onus was on China to start negotiations. While Trump insists there has been progress and that he has spoken with Chinese President Xi Jinping, Beijing has denied such assertions. The confusion just gave investors more reason to sell the dollar and it fell sharply against the safe-haven yen and Swiss franc in the previous session. The U.S. currency was last up 0.11% at 142.19 yen , barely reversing its 1.2% fall, and ticked 0.18% higher against the Swiss franc to 0.8217 , having slid 0.8% on Monday. The euro was down 0.15% at $1.1404, but remained on track for its largest monthly gain against the dollar in nearly 15 years as investors flee U.S. assets and search for alternatives in Europe. Sterling was pinned near a three-year top and last bought $1.3427. Against a basket of currencies, the dollar last steadied at 99.079, having fallen 0.6% in the previous session. Crude oil prices fell in early Asian trading on Tuesday as investors lowered their demand growth expectations due to the ongoing trade war between the United States and China, the world's two biggest economies. Brent crude futures fell by 25 cents, or 0.4%, to $65.61 per barrel by 0024 GMT. U.S. West Texas Intermediate crude futures fell 18 cents, or 0.3%, to $61.87 a barrel. Both benchmarks fell more than $1 on Monday.......