Rupee Hits All-Time Low of 92 Against US Dollar
The Indian rupee experienced a historic low on Friday, dropping to 92 against the American currency before slightly recovering to settle at 91.88 (provisional). This decline was attributed to selling pressure from foreign funds and a general risk-off sentiment in global markets.
Forex traders noted that the rupee initially showed strength but eventually hit a record low of 91.99 per US dollar in intraday trade due to weak domestic markets and continuous foreign fund outflows. Factors such as rising crude oil prices and increased US treasury yields further impacted the rupee’s performance.
Starting at 91.45, the rupee saw a brief improvement to reach an intraday high of 91.41 against the greenback at the interbank foreign exchange. However, it ultimately hit an all-time intraday low of 92.00 before closing at a record low of 91.88 (provisional), marking a 30 paise decrease from the previous closing level.
Just a day before, the rupee had managed to bounce back from its previous all-time low and ended at 91.58 against the US dollar. The previous record low was set on January 21, with the rupee falling by 68 paise to close at 91.65 against the American currency.
Market Trends and Analyst Predictions
Throughout the month, the rupee has experienced a 2% decline, equivalent to 200 paise. Analysts foresee a negative bias in the rupee’s trading due to selling pressure from Foreign Institutional Investors (FIIs) and prevailing risk-off sentiments in global markets. Additionally, factors such as dollar demand from hedgers and imports are expected to further impact the rupee’s value.
Anuj Choudhary, a Research Analyst at Mirae Asset ShareKhan, highlighted that a weak dollar and potential intervention by the Reserve Bank of India (RBI) could provide some support to the rupee at lower levels. The USD-INR spot price is anticipated to fluctuate within a range of 91.60 to 92.30.
Global Market Indicators
Meanwhile, the dollar index, which measures the dollar’s strength against a basket of six currencies, saw a slight increase to 98.36. In futures trade, Brent crude, the global oil benchmark, surged by 1.03% to USD 64.72 per barrel.
Domestic Market Performance
On the domestic front, the Sensex plummeted by 769.67 points to settle at 81,537.70, while the Nifty witnessed a decline of 241.25 points, closing at 25,048.65. Exchange data revealed that foreign institutional investors sold equities worth Rs 2,549.80 crore on Thursday.
