There has been a big fall in the Indian rupee. In today's opening trade, the rupee has fallen 42 paise to the lowest level of 80.38 against the US dollar.
New Delhi: There has been a big fall in the Indian rupee. In today’s opening trade, the rupee has fallen 42 paise to the lowest level of 80.38 against the US dollar. On Wednesday, September 21, the Indian rupee had closed at the level of 79.9750 against the US dollar. The rupee opened at 79.79 against the dollar on Wednesday and saw a steady decline during the day’s trading.
On Wednesday, the dollar index reached a two-decade high of 110.87. However, it is very unlikely that the US Federal Reserve will increase interest rates by 100 basis points to control inflation.
This comes after the US Federal Reserve delivered a 75 basis point hike for the third consecutive time and signaled that it’s expected to reach a whopping 4.63 per cent in 2023.
Due to high crude oil prices, India’s trade and fiscal deficits are expected to rise, and will put increasing pressure on the Indian currency.
The last record low for Rupee was 76.98 against the US dollar on March 7. Meanwhile, it fell 55 paise against the greenback on Friday and ended the day’s trade close to its all-time lows.
“We are victims of that time when the rupee is hitting an all-time- low due to multiple reasons. To describe a few points – a stronger USD, weaker Asian currencies, rebound in oil prices, ongoing Russia-Ukraine war, FII outflow, and a surprise hike by the RBI to tackle inflation could be the major reasons behind the same,” Economic Times quoted CR Forex Advisors MD Amit Pabari as saying.
The US dollar index, which measures the currency against 6 major currencies, was at 103.98 last, stronger than 103.79 at previous close. Meanwhile, yield on the 10-year US Treasury yield jumped to 3.14 per cent, 0.1 per cent higher than previous close.
It must be noted that the depreciation Rupee comes just days after the Federal Reserve increased benchmark interest rates by 50 basis points and signalled more rate increases so as to arrest high inflation.