Forex

Rupee falls 36 paise against $ on global currency rout

PTI Mumbai | Updated on August 26, 2019 Published on August 26, 2019

Representative image   -  Getty Images/iStockphoto

Forex trader said the local unit came under pressure after the latest escalation of the US-China trade war

The rupee, on Monday, declined by 36 paise to close below the 72 level against the US currency for the first time in nine months, hit by a ‘flash crash’ in global currencies due to uncertainty over the trade front.

The rupee settled down by 36 paise at 72.02 to the US dollar, the lowest closing level since November 14, 2018, even as equities spurted more than 700 points at close on stimulus measures.

The local currency had retreated to a low of 72.25 in day trade following a flash crash in currencies such as Turkish lira, Chinese yuan, and Australian dollar against the US dollar.

The global currencies faced a meltdown in the overnight trade due to the escalation between the US and China over the weekend.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.31 per cent to 97.94 after the euro and the pound dropped.

However, reassuring comments by the world’s two largest economies on Monday that they are willing to resolve issues through calm negotiations, helped the currencies pare their losses.

The assurance also supported the crude oil prices with the benchmark Brent crude gaining 0.64 per cent to $59.72 per barrel.

Chinese Vice-Premier Liu He said that his country was willing to resolve the trade dispute with the US through calm negotiations.

US President Donald Trump said that the US and Chinese trade negotiators would very shortly resume talks, in what he described as a breakthrough in the two economic superpowers’ trade war.

 

 

Published on August 26, 2019
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