Rupee's Fall Continues, Slides To 15-Month Low Against Dollar: 5 Points

Dollar-Rupee Exchange Rate Today: The rupee fell to 67.27 per US dollar at day's low, its lowest since February 8, 2017, before settling at 67.08

US Dollar Vs Rupee: The INR had breached the key 67 mark against the USD yesterday.

The rupee recovered today to close higher against the US dollar. At day's low, the rupee fell to 67.27 per US dollar, its lowest since February 8, 2017. The rupee settled at 67.08 against the US dollar. The rupee had breached the key 67 mark against the US dollar the previous day and ended at 67.13 against the US dollar. Economists attribute the rupee's recent weakness against the US dollar to the rising crude oil prices, which puts pressure on balance of payments, and rising US bond yields.

5 Things To Know About Rupee's Fall Today Against US Dollar:

1. Analysts say the combination of higher oil prices, a strong dollar and higher US rates is weighing on emerging market assets, including their currencies, as it could significantly worsen their trade balance and also encourage investors to shift funds to higher-yielding US assets.
2. "The US dollar is consolidating against majors and continues to grind higher against emerging market currencies. The steep rise in US short term rates has been one of the major reasons for depreciation of emerging market currencies," says forex advisory firm IFA Global in a note.
3. Global crude oil prices remained elevated today at over three-year highs as investors braced for US President Donald Trump's decision on whether to withdraw the United States from the Iran nuclear deal, a move that could disrupt global oil supply. Global benchmark Brent crude futures stood at $75.54 per barrel, having risen as high as $76.34 on Monday. India imports bulk of its crude oil requirements.
4. Outflow from domestic capital markets is also weighing on the rupee. In this month so far, foreign portfolio investors have sold $440 million in equities and $500 million in debt, says the advisory firm.
5. Madan Sabnavis, chief economist of CARE Ratings, sees the rupee remaining volatile against the US dollar in the near future. "The US interest rates will continue to remain high until such time that the US Federal Reserve does something decisively. We can expect volatility until such time RBI intervenes in the market at what it thinks would be the right rate," he said.

(With agency inputs)

from NDTV News - Special https://ift.tt/2rsTW6P