MUMBAI, March 12 (Reuters) - The Indian rupee is expected to open flat-to-slightly lower on Wednesday as worries about a slowdown in the U.S. economy continue to dampen risk appetite, while persistent portfolio outflows also weigh on the currency.

The one-month non-deliverable forward indicates that the rupee will open at 87.22-87.24 to the U.S. dollar compared with its previous close of 87.2125.

Unpredictable tariff policies under U.S. President Donald Trump have raised concerns about the U.S economy, prompting traders to add to bets on rate cuts by the Federal Reserve and hurting the dollar.

Traders are pricing in about 80 basis points of Federal Reserve rate cuts this year, up from around 72 bps last week.

The dollar index was hovering near a five-month low at 103.5 in Asia trading. Trump had pledged to double tariffs on Canadian steel and aluminium imports to 50% on Tuesday, only to reverse course just hours later.

Other Asian currencies were mostly weaker, with the Malaysian ringgit and Indonesian rupiah leading losses.

In addition to uncertainty stemming from fluctuating U.S. trade policies, a persistent exodus of foreign portfolio investors from Indian stocks has been a sore point for the rupee.

Overseas investors have net pulled out over $16 billion from local stocks in 2025.

Focus will be on India and U.S. consumer inflation data due later in the day. India's CPI is expected to have eased to 3.98%, while month-on-month U.S. core CPI likely dipped to 0.3% in February, according to Reuters polls.

The data is expected to influence expectations of rate cuts by the countries' central banks.

"We think that RBI (Reserve Bank of India) is continuing to pivot towards growth and we think that the bias for INR is for it to still climb weaker through 2025," MUFG Bank said in a note.

KEY INDICATORS:

** One-month non-deliverable rupee forward at 87.45; onshore one-month forward premium at 22.25 paisa

** Dollar index at 103.48

** Brent crude futures up 0.7% at $70 per barrel

** Ten-year U.S. note yield at 4.27%

** As per NSDL data, foreign investors sold a net $57.1 million worth of Indian shares on March 10

** NSDL data shows foreign investors bought a net $80.9 million worth of Indian bonds on March 10

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https://www.reuters.com/markets/currencies/us-economic-worries-portfolio-outflows-may-keep-rupee-defensive-2025-03-12/