Rupee Tumbles 82 Paise To Close At All Time Low Of 95.31 Against Dollar
The domestic sentiment was further weighed down by Prime Minister Modi’s "Nation First" austerity appeal, which urged citizens to reduce fuel consumption and defer non-essential foreign travel to manage dollar outflows.
Mumbai: The Indian rupee closed at a record low level of 95.31 against the dollar on Monday as the breakdown in peace negotiations between the US and Iran, triggered a rally in crude oil prices and bolstered the safe-haven appeal of the dollar.
The domestic sentiment was further weighed down by Prime Minister Modi’s "Nation First" austerity appeal, which urged citizens to reduce fuel consumption and defer non-essential foreign travel to manage dollar outflows. The rupee’s fall marked its single biggest day decline since March 27 and mirrored weakness across regional currencies.
At the interbank foreign exchange market, the rupee opened at 94.88, it made a low of 95.28 and a high of 94.87 before closing the day at 95.31, a fall of 83 paise compared to its previous close of 94.48. Most Asian currencies fell on Monday as stalled US-Iran peace talks dampened risk appetite with the Yuan being the only one which found support due to encouraging domestic inflation and trade data with the latter showing 15 per cent growth in exports. Brent crude, the global oil benchmark, rose 2.52 per cnet to $103.8 per barrel in futures trade.
“PM Modi asked for a slowdown on buying petrol, gold, foreign trips etc to save valuable foreign exchange as also to keep fiscal deficit lower. The implication of these steps in the short term would be a slowdown in growth,” said Anil Bhansali, head treasury at Finrex Trading Advisors.
“If oil prices go up, the rupee continues to fall. But today’s fall of almost 80 paise was quite on a high side considering that oil prices rose only by about $ 6 per barrel while the rupee closed at its lowest for the day. FPIs continued to remain sellers on Friday thus keeping dollar bid today also when the markets are down. The rupee is expected to remain between 94.75 to 95.50 tomorrow,” added Bhansali.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 98.02, up 0.13 per cent.