With positive US economic news propping up the US Dollar and the likelihood of the Federal Reserve tapering stimulus within the next few months rising, the Rupee plummeted to a fresh record low against its American counterpart.
The US Dollar to Indian Rupee Exchange Rate was in the region of 60.9900 as of 11:10 GMT
The Rupee posted a decline of 1.2 per cent, its most significant for nearly two weeks, as investors speculated on what affect last week’s positive US employment data would have on the Federal Reserve’s decision to pare bond buying.
As one Mumbai-based industry expert observed: ‘The [US employment] data could lead to outflows from all emerging markets. The central bank could come in and intervene to protect key levels.’
After briefly hitting a record low of 61.212 against the US Dollar a slight upward correction saw the Rupee trading in the region of 60.965.
As trade continued the Rupee was able to recoup some losses as official sources intimated that the Reserve Bank of India has once again sold Dollars in order to temper the currency’s volatility.
The Rupee’s movement prompted strategist Nick Verdi to stated: ‘The RBI is definitely concerned about Rupee weakness. It will look to combat this mostly through verbal intervention [and] moves to discourage speculation.’
Indian economic news to watch out for this week includes industrial production and trade balance figures, due out on Friday.
Investors will also be looking ahead to the Reserve Bank of India’s next rate decision, taking place on July 30th.
US news, particularly the publication of minutes from the Federal Reserve’s latest policy meeting and Fed Chairman Ben Bernanke’s address, is likely to inspire Rupee movement as the week progresses.
Positive US news could see the Rupee weaken to fresh record lows.
Current Rupee (INR) Exchange Rates
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 90.7491 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 78.2524 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 60.9900 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 55.2390 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 47.2464 >
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 57.7163 >
(Correct as of 11:10 GMT)
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