Forex

Rupee slides to historic low to close below 70

Agencies | | Updated on: Aug 16, 2018
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The rupee on Thursday slid 26 paise to close below the 70 mark for the first time against the US currency, hammered by strong dollar demand amid growing concerns over awidening trade deficit.

The Indian currency collapsed to a historic intra-day trading low of 70.40 before closing at a fresh life-time low of 70.15 per dollar, down by 26 paise or 0.37 per cent over the previous close.

The RBI intervened in the currency market to save the beleaguered currency, currency traders said.

Emerging market currencies and stocks remained in investors’ cross-hairs as worries mounted despite a fresh rally for the Turkish lira. Headwinds in the form of a widening trade deficit due to surging crude prices amid unsupportive global factors kept forex sentiment shaky and largely weighed on the rupee.

A massive exodus of capital outflows from both the equity and debt market against the backdrop of the US Federal Reserve’s anticipated interest rate policy is triggering wide panic, a forex dealer said.

High current account and fiscal deficits mean the central bank may have little room to tap into its reserves to defend the currency, the dealer said.

The Indian currency has lost 10.5 per cent of its value so far this year.

 

 

Published on August 16, 2018

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