Hyderabad: The Indian rupee on Tuesday hit an all-time low of Rs 79.36 against the US dollar.
Widening trade deficit, weakness in global currencies against the dollar and expectations of aggressive rate hikes by the US Federal Reserve in coming months also weighed on the local unit.
Besides, heavy portfolio outflows, soaring crude oil prices, and a rising interest rate regime of the major central banks have been the key catalysts behind this recent bout of weakness in the rupee-dollar exchange rate.
What do experts expect?
In a research report, Kotak Securities said the dollar will touch Rs 80 in the near term.
Kotak Securities said the widening trade deficit, narrowing of interest rate differentials, and Reserve Bank of India’s foreign exchange intervention strategy (sell spot along with buy-sell swaps) leading to a collapse in forward premiums, led to relatively sharp depreciation in the rupee recently.
Uncertainty in macro environment
Citing the uncertainty in the global macro environment, the report said the Indian rupee is likely to be under pressure, especially if crude prices remain elevated and global growth slows down.
Meanwhile, the price of 24 carat gold touched Rs 54,000 per 10 grams on Tuesday.
