The Rupee dipped to a new intraday record low of 84.9375 per US Dollar (USD) so far on Wednesday, weighed down by facrors such as all-time high trade deficit and a strengthening greenback.
The Indian unit (INR) opened at tad weaker at 84.9175 per USD on Wednesday against previous all time recoding closing low of 84.8950.
Currently, the Rupee is trading at 84.9250 per USD. On Tuesday, INR had hit a fresh low of 84.93.
Forex market dealers said that the RBI is intervening in the market through USD sales to support the Rupee, slowing down its depreciation.
Radhika Rao, Senior Economist & Executive Director, Group Research, DBS Bank, observed that market participants will continue to test the incoming Governor’s view on the currency, with the Rupee at record lows below 84.80 this week.
“Prospect of further yuan/CNH weakness and high UST yields have also kept the Rupee under pressure…There is also market chatter that the RBI’s NDF (non-deliverable forward) short position has close to halved from the earlier rumoured $60 billion.
“DBS FX strategist sees scope for further rupee slippage over the next 3 month and 12 month horizon, beyond 86/dollar,” she said.