Rupee Hits All Time Low: Rupee falls 46 paise to record low of 78.83 per dollar, know the reason
Rupee
Rupee Hits All Time Low: The depreciation of the rupee against the US dollar is not taking its name. It seems that the rupee is beginning to set new records of decline against the dollar. The rupee on Tuesday fell 46 paise to a new all-time low of 78.83 per dollar (provisional) against the US currency at the interbank foreign exchange market. The reason for the fall is the continuous outflow of foreign capital from the market and the rise in crude oil prices.
Rupee was weak
The rupee opened weaker at 78.53 against the dollar at the interbank foreign exchange market and closed at its new all-time low of Rs 78.83 against the US currency at the end of trading. The rupee touched a new all-time low of 78.85 per dollar during trading. The weakness in the rupee is coming from the rise in crude oil and foreign investors withdrawing money from the Indian market. Global oil benchmark Brent crude futures rose 1.89 per cent to $117.26 per barrel. According to stock market data, foreign institutional investors were net sellers in the capital market. He sold shares worth Rs 1,278.42 crore on Monday.
Dollar getting stronger
Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, said, “Indian rupee slipped to an all-time low against the US dollar amid weak domestic equity market and rise in crude oil prices. Incessant selling by overseas investors also put pressure on the rupee.” Meanwhile, the dollar index, reflecting the US dollar’s position against the six major currencies, was up by 0.01 per cent at 103.95.
What will be the effect of weakness in rupee
India imports everything from oil to essential electric goods and machinery along with other gadgets including mobile-laptops. If the rupee weakens, then more money will have to be paid for imports. Due to this, the price of these items in the Indian market will increase. At the same time, India also imports crude oil. This will also make the import of crude oil expensive. This means that the price of crude oil may increase in the coming days. India buys 80 per cent of its crude oil requirement from abroad. Its payment is also done in dollars and due to the cost of dollars, the rupee will cost more. Due to this, freight will be expensive, due to its effect, inflation will be hit further on everything needed.
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