Rupee sets record low, crosses 94 against dollar for the first time
Since the Iran war began, the rupee has depreciated by more than 3.25 percent against the dollar. Since then, the rupee has fallen by approximately 100 rupees against the dollar. On February 28, the rupee was at 91.08 against the dollar.
On Monday, the rupee crossed the 94 mark for the first time. The Indian currency fell 50 paise to close at a new record low of 94.03 (provisional) against the dollar.
This was due to rising crude oil prices in the international market and the continued outflow of foreign funds, which alarmed investors.
Forex traders said that the strengthening dollar and a sharp decline in domestic stock markets further weakened the local currency. Let us also tell you what kind of data was seen regarding the rupee in the currency market.
Rupee crosses 94 against dollar
At the interbank foreign exchange, the local currency opened at 93.84 and weakened throughout the day. It finally crossed the 94 mark against the dollar for the first time and closed at 94.03 (provisional), down 50 paise from its previous close.
On Friday, the rupee had fallen 64 paise to close at 93.53, after which it had crossed the 93 mark against the dollar.
Significantly, since the Iran war began, the rupee has depreciated by more than 3.25 percent against the dollar. Since then, the rupee has declined by nearly 100 rupees against the dollar. On February 28, the rupee was at 91.08 against the dollar.
Rupee may fall further
Anuj Chaudhary, Research Analyst at Mirae Asset Sharekhan, said that on Friday, the rupee hit its lowest level ever, crossing the 94 mark for the first time amid rising geopolitical tensions in West Asia and weak domestic markets.
Rising crude oil prices and FII outflows also weighed on the rupee. He said, "We expect the rupee to trade with a negative bias, as the deteriorating global environment and geopolitical tensions could continue to pressure the rupee.
However, timely intervention by the Reserve Bank could support the rupee at lower levels." He further said that the USD-INR spot price is expected to trade in the range of 93.60-94.40.
Big drop in the market
The dollar index, which measures the greenback's strength against a basket of six currencies, was trading 0.14 percent higher at 99.78. Global oil benchmark Brent crude futures fell 1.11 percent to $113.4 per barrel.
In the domestic stock market, the Sensex fell 1,836.57 points, or 2.46 percent, to 72,696.39, while the Nifty fell 484.30 points, or 2.10 percent, to close at 22,630.20. Foreign institutional investors sold shares worth ₹5,518.39 crore on a net basis on Friday,
according to exchange data. Meanwhile, the RBI reported on Friday that India's foreign exchange reserves declined by ₹7.052 billion to ₹709.759 billion during the week ended March 13.