Published: Tue, September 11, 2018
Economy | By

Rupee hits fresh low, tumbles below 72 against the dollar

Rupee hits fresh low, tumbles below 72 against the dollar

The rupee fell as much as 1.3 percent to a new record low of 72.66 against USA dollar on Monday but regained a bit after the comments.

The currency witnessed intense volatility and hit all-time low of 72.64 during morning deals. It had opened at 72.18 per dollar. The headline consumer inflation rose 4.17 percent in July from a year earlier and is expected to pick up momentum on higher crude prices and the weakening rupee.

India expressed concern about the rupee's decline for the first time and said it's considering a plan to tap its citizens overseas, according to a government official. He expects the rupee to weaken further to as low as 75 per dollar and sees the benchmark yield reaching 8.40 per cent.

The dollar's strength against rival currencies overseas and fears of a possible escalation in the US-China trade conflict also put pressure on the rupee. The Nifty too was trading 116 points or 1% lower at 11,473 level.

High oil prices were a spoiler for both the rupee and bonds.

Last week, Finance Minister Arun Jaitley attributed the fall in rupee to global factors and stressed that the domestic unit was better off as compared to other currencies.

Currency dealers said the central bank is not intervening aggressively as before.

The rupee on Monday plunged by 45 paise against the U.S. dollar.

"Nevertheless, most rated India-based corporates have protections in place-including natural hedges, some United States dollar revenues and financial hedges -to limit the negative credit implications of a potential further 10 per cent weakening of the rupee to the U.S. dollar from Thursday's (September 6) rate (of 72.11 a dollar)", Moody's VP and Senior credit officer Annalisa DiChiara said.

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