The Indian Rupee has tumbled again and is slipping closer to the record low recorded last week against the US Dollar.
Tuesday’s fall came after investors remained concerned that the Indian government would not act decisively to restore confidence to the nation’s economy and as share markets fell.
The Rupee continues to be battered by worries that capital outflows will rise as the US Federal Reserve prepares to taper its monetary stimulus programme, increasing the currency’s vulnerability to the huge current-account deficit.
“The weak external position puts the currency under pressure and therefore limits policy makers ability to boost growth, financing the current account is the single biggest concern for India right now,” said Sonal Varma, economist at Nomura Holdings Inc.
Last month investors withdrew around $2.3 billion from Indian stocks and bonds. Withdrawals look set to continue until at least September 17th when the USA’s Federal Open Market Committee gathers to decide on whether to reduce its monthly bond purchasing programme. The outflow of foreign funds has also combined with disappointing economic data with India’s GDP expanding at its slowest pace since 2009.
On Thursday the Reserve Bank of India will welcome a new governor in the form of former International Monetary Fund economist Raghuram Rajan. All eyes will be on him to see how he plans to tackle the Rupee’s decline. A strong plan could offer some support to the flagging currency.
Current Rupee (INR) Exchange Rates:
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 105.3470 >
The Euro/Indian Rupee Exchange Rate is currently in the region of: 89.0924 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 67.6224 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.0265 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 52.8112 >
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 64.1553 >
(Correct as of 10:00 am GMT)
Comments are closed.