Categories: STOCK MARKET

Rupee Weakens Against US Dollar Amid Global Economic Uncertainty

Keywords: Rupee, US Dollar, currency exchange, forex market, Indian economy, global economic trends, INR depreciation

The Indian rupee continued its downward trajectory against the US dollar, closing at ₹83.40 per dollar, marking a fresh low for the currency. This decline is largely attributed to rising global oil prices, sustained foreign outflows, and a strengthening US dollar driven by robust economic data from the United States.

Key Factors Behind the Depreciation:

  1. Global Oil Prices: India, being a major importer of crude oil, faces increased fiscal pressures as oil prices hover above $90 per barrel. This impacts the trade deficit, adding downward pressure on the rupee.
  2. Dollar Strength: The US dollar index surged past 105, supported by better-than-expected job growth and Federal Reserve’s hawkish stance. Investors are flocking to the dollar as a safe-haven currency.
  3. FII Outflows: Foreign Institutional Investors (FIIs) have been offloading Indian equities, contributing to the weakening rupee. Over $1 billion worth of net outflows have been recorded this month.

Impact on the Indian Economy:

  • Import Costs: A weaker rupee increases the cost of imports, particularly crude oil, leading to inflationary pressures.
  • Export Competitiveness: While a weaker rupee makes Indian exports cheaper globally, the net benefits may be offset by higher production costs.
  • Corporate Earnings: Companies with significant dollar-denominated debt are expected to face higher repayment burdens.

Expert Commentary:

Economists suggest that the Reserve Bank of India (RBI) may intervene to stabilize the rupee, but its measures could be limited given the external economic headwinds. “The rupee’s performance will largely depend on crude oil trends and the Federal Reserve’s policy stance,” said a senior forex analyst.

Outlook:

Market participants are keeping a close watch on global economic indicators and upcoming Federal Reserve meetings. With uncertainties persisting, the rupee may experience further volatility in the near term.

Stay tuned for live updates on the rupee’s movement and real-time business news on Kanishk Social Media—your go-to source for comprehensive stock market and legal news.

Ashutosh Dubey

legal journalist,Public Affair Advisor AND Founding Editor - kanishksocialmedia-BROADCASTING MEDIA PRODUCTION COMPANY,LEGAL PUBLISHER

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