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The rupee plunged to a record intra-day low of 77.7950 per Dollar due to the likelihood of global growth being dragged down on account of sharp slowdown in China on account ofCovid-19 related lockdowns and higher crude oil prices.
The Indian unit opened gap down at 77.67 per Dollar, 22 paise weaker vis-a-vis the previous close of 77.45.
“The risk-off mode continues to dominate the markets, as the major recession fears were ignited after the Chinese retail data for April showed a contraction of 11 per cent, the biggest fall since March 2020 due to the strict Covid-19 lockdown
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Forex reserves decline $11 billion so far this fiscal
Even as RBI sells dollars to defend rupee“...The crude oil prices trade higher near $115/barrel to the volatile sessions amid China’s Covid lockdown and the EU’s retaliation on Russia’s oil ban. Tracking all the sentiments and higher oil prices, today, the USDINR pair is likely to trade in the range of 77.40-78.00,” said Amit Pabari, MD, CR Forex Advisors.
He observed that domestically, at a time when global risk-off sentiments, higher oil prices and FII’s outflows are weighing on the Indian rupee, RBI is supporting the currency by intervening across markets, with forex reserves declining for yet another week by $1.77 billion to $595.95 billion.
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