Check Why The Indian rupee hit an all-time low and its meaning
The Indian rupee on Thursday morning opened at an all-time of 68.89 against the US Dollar, slipping a further twenty-eight paise against the prior close of 68.61.
This was after Indian Rupee closed at a 19-month low on Wednesday, placing the biggest single program fall, plunging 37 paise.
In morning trade, the currency breached the 69-mark.
WHAT MAKES A FRAGILE RUPEE
1) The recession in the currency has its roots in the concerns that higher primitive oil prices. Oil prices in a global market inched up further with US crude futures flower $. 23 to reconcile at $72. 76 a barrel. Brent crude increased $1. 31 to decide at $77. 62 a barrel.
2) The foreign currency market was nervous after RBI painted a dark picture of the banking sector in its bi-annual financial stability report.
3) Foreign currency traders are also concerned with the future of global trade up against the grim foundation of an escalating investment rhetoric between the US and China.
4) A huge selloff in domestic equities further added pressure worrying heavy capital outflows.
What Sort Of Weak Indian Rupee Affects You
1) Although a weakening Indian Rupee will mean Indian exporters are left smiling, importers, however, will feel the warmth. According to latest govt data, India’s trade deficit stood at $14. 6 billion dollars in-may, 5. 6 every cent above a season ago. A falling rupee will only widen this gap2) As imports, especially oil imports get more expensive, it could possibly translate into higher fuel costs, which will raise, or at least maintain your pressure on the overall expense of monetary activity. An inflationary pressure may add to Book Bank of India’s (RBI) woes and cause another hike in key interest levels.
3) The erosion in rupee’s value has detrimentally hit the bond market too. The 10-year standard bond yield shot-up to 7. 87 per dollar from 7. 83 every cent on Wednesday.
4) For those traveling in foreign countries as tourists or Indians studying abroad, along with rupee’s value would suggest a better cost of living.
Source: Times Of India
Whizfeed for more news and latest updates