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Published on 5/07/2022 5:43:23 PM | Source: Religare Broking Ltd

Rupee Quote : The Indian rupee has slumped to a new record low of 79.37 mark By Ms. Sugandha Sachdeva, Religare Broking

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Quote on Rupee 05 July 2022 By Ms. Sugandha Sachdeva, VP- Commodity & Currency Research, Religare Broking Ltd

The Indian rupee has slumped to a new record low of 79.37 mark against the dollar, depreciating by around 0.50% on the back of a rise in the dollar index towards a new twenty-decade peak. 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. On the domestic front, India’s trade deficit has swelled to a record high of $25.63bln in June amid high commodity prices, leading to a rise in the import bills. Besides, the current account deficit is expected to widen to around 2.9% of GDP in FY23 as against 1.2% in FY22, which is weighing on the domestic currency. Moving ahead, we foresee the Indian rupee heading lower towards the 80-81 zone against the dollar, though the RBI is expected to proactively intervene in the markets to curb the pace of decline in the domestic currency.

 

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