Rupee hits a record low of 70.07 against dollar
14 August 2018
Indian rupee plumetted record low of 70.07 against the US dollar, extending the previous day’s 110 paise loss when it hit 69.93 against the greenback. The heavy losses point to a further depreciation of the rupee to levels near 8 a dollar, say analysts.
The local currency opened marginally higher at 69.85 per dollar in early trade today but soon lost the gains falling to a record low of 70.07 a dollar.
It has ended at an all-time closing low the day at 69.93 on Monday against its Friday's close of 68.83, which is a biggest single session decline against dollar since 3 September 2013.
The fall in rupee was mainly impacted by the strengthening of the US dollar on the back of a significant drop in the value of the Turkish Lira on the back of fears that economic crisis in Turkey could spread to other global markets.
Emerging market currencies have declined sharply along with Turkish lira which had fallen to an all time low after US president Donald Trump imposed sanctions and tariffs on Turkey.
However, India’s consumer price inflation number showed a decline in July compared to the previous month, strengthening views that the RBI in its next meeting could hold rates. Inflation in July rose 4.17 per cent compared to growth of 4.92 per cent in the previous month.
Marketmen expect the dollar-rupee rate to quote in the range of 69.70 and 70.25-70.50.
The rupee has been on the downslide this year, having slipped 9 per cent in 2018
India’s currency has been among the hardest hit in Asia from the recent Turkey-led sell-off in emerging assets, thanks to a wide current account deficit (CAD) that’s strained by higher oil prices. A weaker rupee could complicate the Reserve Bank of India’s (RBI) job of keeping inflation in check.