Indian Rupee Falls to Lifetime Low of 80.99 Against US Dollar After Federal Reserve Hikes Repo Rate
Indian rupee fell to an all-time low against the US dollar on Friday, breaching the 81 mark, as the greenback strengthened on the back of the Federal Reserve repo rate hike.
Mumbai, September 23: Indian rupee fell to an all-time low against the US dollar on Friday, breaching the 81 mark, as the greenback strengthened on the back of the Federal Reserve repo rate hike.
The local currency was trading at 80.998 at 4 pm IST, and was trading at 80.856 vs dollar in the afternoon. Globally, the dollar has surged over the past few days as the US Fed has signalled a longer-than-expected tightening cycle. Indian Rupee Falls Record Low Against US Dollar: RBI Expended About USD 80 Billion or 15% of Reserves Moderating Rupee Fall.
At 09:25 am IST on Friday, the local currency was trading at 81.13. The rupee had plunged 1.1 per cent against the dollar on Thursday, closing at a record low of 80.87 per dollar.
Geojit Financial Services Research Head Vinod Nair: "A rise in the US 10-year bond yield and a strong dollar index influenced FIIs (foreign institutional investors) to flee emerging markets. A fall in liquidity in the banking system, a weak currency and a current premium valuation have set the market outlook bearish for the near term."
With reference to the Indian scenario, Nair also said: "With aggressive monetary policy action by central banks, the global growth engines are in a slowdown mode, whereas India is currently in a better position with a pickup in credit growth and an uptick in tax collection. The current volatility might persist for a while. Investors are advised to wait and watch until the dust settles."
On Wednesday, government bonds also started extending sharp losses with the yield on the 10-year benchmark bond last trading 7 basis points higher at 7.38 per cent. Bond prices and yields move inversely.
Domestic equity markets edged lower in Friday's trade. Key indices Nifty50 dropped over 300 points to trade near the 17,300-level and S&P BSE Sensex fell more than 1,100 points during the Friday session.
(This is an unedited and auto-generated story from Syndicated News feed, LatestLY Staff may not have modified or edited the content body)