Bihar and Jharkhand
Bihar and Jharkhand News Service
www.biharandjharkhand.com
The no1 portal serving the people of Bihar and Jharkhand around the world
Bihar and Jharkhand News

 News from Far and Wide

Inflationary fears dent rupee; falls to new low of 72.67 per USD

Posted on: September 10, 2018


US dollar. (File Photo: IANS)

Mumbai, Sep 10 (IANS) Indian rupee tumbled to a new record low of 72.67 against the US dollar on Monday amid expectation of higher overall inflation rate, growing protectionism in global trade and an increasing outflow of foreign funds from the country's equity market.

However, the Indian rupee recovered to settle at 72.45, its new record lowest closing level against the US dollar. It closed Monday's trade weaker by 72 paise than its previous close of 71.73 per greenback at the Inter-Bank Foreign Exchange Market.

"Alleged intervention from RBI (Reserve Bank of India) aided in the recovery of Indian rupee against the USD," Anindya Banerjee, Deputy Vice President for Currency and Interest Rates with Kotak Securities, told IANS.

"Rising oil prices, strong economic data in the US and trade war are causing the weakness in the INR," Banerjee said.

Rushabh Maru -- Research Analyst at Anand Rathi Shares and Stock Brokers said: US non-farm payroll data has posted better than expected reading. This indicates that the US Fed is on track to raise interest rates two more times this year... once in September and the second one could be in December.

Historically, higher interest rates in the US have led foreign institutional investors (FPIs) away from emerging markets such as India.

"Focus will now shift to India's IIP (Index of Industrial Production) and CPI (Consumer Price Index) data," Maru said.

The data on retail inflation rate, the Consumer Price Index is scheduled to be released on Wednesday.

Apart from macro-data, any further outflow of foreign funds from the Indian equity and bond markets might have an adverse impact on the rupee.

In terms of investments, provisional data with exchanges showed that FPIs sold scrip worth Rs 841.68 crore.

--- Indo-Asian News Service
Contact: webmaster@biharandjharkhand.com

© All Rights Reserved