Rupee hits near 5-year low

Rupee hits near 5-year low
Highlights

The battered rupee on Monday suffered yet another blow by plunging 34 paise to end at a near five-year low of 68.80 against the buoyant US dollar in the midst of weak global trends and concerns on macro-economic front.

Mumbai: The battered rupee on Monday suffered yet another blow by plunging 34 paise to end at a near five-year low of 68.80 against the buoyant US dollar in the midst of weak global trends and concerns on macro-economic front.

This is the level last seen on 28 August, 2013. With very little chance of RBI intervention, panic dollar demand from importers and speculative traders sent the home currency sinking to a low of 68.81 in late afternoon deals.

The currency touched a high of 68.33 in morning deals, but the initial gains had been short-lived. The rupee tumbled below 69-mark for the first time ever on Thursday and hit a life-time low of 69.10.

India is facing severe macro challenges and goldilocks economic conditions are now changing fast against the grim backdrop of bubbling global crude prices and most likely to disrupt government's fiscal maths and poses additional upside risks to inflation forecast. Trade worries were at the heart of currency market weakness.

"The Rupee has been one of the worst performing currencies among peers. Against the USD, it has depreciated by 6.6 per cent in calendar year 2018 and 8 per cent year to date. Adding to our concern is the increasingly hawkish Federal Reserve, which has now initiated a reversal of the Quantitative Easing (QE) – marking an end to global easy money," Karan Mehrishi, Lead Economist at Acuite ratings and research, said.

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