1. Home
  2. Business
  3. Rupee falls to 15-month low against US dollar as crude oil prices rise

Rupee falls to 15-month low against US dollar as crude oil prices rise

By Priyanka Verma 
Updated Date

The Indian rupee depreciated to 75.42 against the US dollar at day’s low today, weighed down by the strengthening of the greenback in the overseas market and firm crude oil prices. At the interbank foreign exchange, the rupee opened on a weak note and fell to 75.42, its weakest since July, 2020, registering a decline of 6 paise from the last close. In recent trade, rupee was trading at 75.26 against the US dollar.

Also Read :- Noida Metro to provide free smart cards for Aqual Line passengers, get it done soon, only 2 days left

On Monday, the rupee slid by 37 paise to close at 75.36 against the US dollar. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.03% to near one-year high of 94.34.

“Rupee has been hit with the double whammy effect of elevated crude oil prices and a strengthened dollar. Energy crunch across the Asia to Europe belt have led to sharp rise in oil prices and renewed concerns of hot-steaming inflation. Being India importing nearly 80% of its oil needs, high prices result in increased imported inflation thereby putting rupee under pressure,” said CR Forex Advisors in a note.

“Additionally, the energy crisis in China are deepening as floods have forced miners to reduce output, sending coal prices even higher. That apart, China Evergrande Group reportedly looking set to miss its third round of bond payments and news of more Beijing crackdown on private firms have dented the risk-on sentiment thoroughly,” it added.

Going ahead, analysts said, investors shall key an eye on India’s September CPI Inflation numbers and the Industrial Output for August due later today for further direction in rupee.

Also Read :- US President Joe Biden to host PM Modi for State visit this summer.

The positive for rupee remains the upcoming IPOs by nearly 35 companies looking to raise approximately ₹80,000 crore from October to December, CR Forex Advisors said.

Indian companies have raised $10.8 billion from first-time share sales this year, according to data compiled by Bloomberg. At this pace, 2021 could well surpass the record $11.8 billion mopped up in 2017.

On flip side, “the roof of 75.50-75.60 is acting as a stiff resistance, if broken then we could see a move towards 75.80 to 76.00 levels over the near term. It will be watchful to see whether RBI intervenes to protect rupee beyond these levels or not,” CR Forex Advisors said.
Foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth ₹1,303.22 crore, as per exchange data.

On the domestic equity market front, the 30-share Sensex was trading marginally lower amid weak Asian equity markets as investors grew increasingly concerned about a growing energy crisis, spiking inflation, signs of a slowdown in the global economy and an end to central bank financial support.

The Reserve Bank of India at its policy review last week lowered its full year inflation projection to 5.3% from 5.7% but sounded cautious about the impact of high global crude and other commodity prices on inflation.

Also Read :- RRTS gets Rs. 3,596 crore in union budget 2023.

For the latest news and reviews, follow us on Facebook, YouTube and Twitter पर फॉलो करे...