INR Vs USD: A sharp surge in trade deficit too impacted the Indian rupee today.
The Indian rupee slipped 26 paise to close below the 70-mark for the first time, reported news agency Press Trust of India (PTI). The fall in Indian currency was due to strong US dollar demand amid growing concerns over widening trade deficit. The Indian rupee collapsed to a historic intra-day trading low of 70.40 before closing at fresh life-time low of 70.15 per dollar, down by 26 paise or 0.37 per cent over the previous close, PTI further said. According to traders, Reserve Bank of India (RBI) intervened in the currency market to save the beleaguered currency.
Here are 10 things to know about Indian rupee's movement today:
According to forex dealers, besides strong demand for the American currency from importers, capital outflows mainly weighed on the domestic currency.
A sharp surge in trade deficit too impacted the Indian rupee today. Trade deficit soared to a near five-year high of $18 billion, data released by the commerce ministry on Tuesday showed.
Depreciation of the Turkish lira against the dollar after the US imposed tariffs on steel and aluminium imports also put pressure on the Indian rupee today.
The Indian currency has lost 10.5 per cent of its value this year so far against the backdrop of country's ballooning fiscal deficit and surging crude prices and mounting worries surrounding the US-China trade conflicts.
The rupee has been one of the worst performing currencies among peers this year - raising fears of a repeat of the currency crisis of 2013.
Officials said that country's crude oil import bill is likely to jump by about $26 billion in 2018-19 due to the rupee's fall, which could fan inflation worries.
Finance Minister Arun Jaitley on Wednesday said that foreign exchange reserves are comfortable by global standards and sufficient to mitigate any undue volatility in the foreign exchange market.
Meanwhile, foreign institutional investors (FIIs) sold shares worth a net of Rs. 378.84 crore on Tuesday, as per provisional data.
Domestic stock markets closed Thursday's session on a negative note. The S&P BSE Sensex tanked 188.44 points, or 0.50 per cent, to end at 37,663.56. The NSE's Nifty50 index tripped 50.05 points or 0.44 per cent to settle at 11,385.05. (With agencies inputs)