In the last 3 weeks, the rupee has fallen by about 3 rupees against the dollar. Such a huge decline in the currency market has not been seen in such a short period of time in the last few years. If we look at the data, due to the efforts of RBI on April 17, the rupee was seen at the level of 92, which has increased to a lifetime low of 95.50.
According to experts, due to indifference of foreign investors, rise in dollar index, increase in crude oil prices and geopolitical tension, there has been a record decline in the rupee against the dollar. According to experts, unless the geopolitical tension subsides and the prices of crude oil come down, the rupee will continue to fall against the dollar.
It is a different matter that if RBI intervenes in the currency market then the rupee may get some relief. But after that the same situation is sure to happen again. Let us also tell you what kind of figures are being seen in the currency market.
Rupee on Lifetime Loan
In early trade on Tuesday, the rupee fell 20 paise to 95.43 against the US dollar as the market sentiment remained weak following renewed military confrontation between US and Iranian forces in the Gulf region. Forex traders said that due to instability in the Gulf region, there is nervousness among investors, due to which they are largely investing their money in safe-haven assets. The US dollar is getting the most benefit from this situation. Apart from this, Brent oil prices remain around $ 113 per barrel, due to which there is pressure on the economies of oil importing countries like India.
In the Interbank Foreign Exchange market, the rupee opened at 95.30, but in early trade itself it weakened to 95.43 against the US dollar. In this way, a decline of 20 paise was recorded as compared to the previous closing price. On Monday, the rupee fell by 39 paise and closed at its lowest ever level of 95.23 against the US dollar. This means that in two days the rupee has fallen by 59 paise against the dollar and has come down to record levels. According to experts, further decline in rupee may be seen in the coming days.
Fall of Rs 3 in 20 days
The special thing is that a fall of Rs 3 has been seen in the rupee against the dollar. If we look at the figures, on April 17 the rupee had reached the level of 92.60 against the dollar. In which since then till now a decline of about 3 rupees has been seen and the figure has come to the level of 95.43. In recent times, this can be considered as the biggest fall in rupee against dollar in just 20 days. If experts are to be believed, in the coming days the figure may go up to the level of 96 to 97.
Why did the rupee fall?
Anil Kumar Bhansali, Treasury Head and Executive Director, Finrex Treasury Advisors LLP, said that due to the huge surge in oil prices, the rupee had fallen to a low of 95.0875 on Monday. This morning also it opened lower as the dollar index rises due to safe-haven buying and oil prices rise due to the ongoing war in the Gulf region, the rupee weakens further. Bhansali further said that due to high oil prices, there will be selling pressure on the rupee against the dollar, as oil companies and FPIs (foreign portfolio investors) will intensify purchasing of dollars.
stock market crash
Meanwhile, the dollar index—which measures the strength of the US dollar against six different currencies—was trading 0.15 percent higher at 98.51. The prices of Brent crude, considered the global oil benchmark, were trading at US $ 113.22 per barrel, down 1.07 percent in futures trade. Talking about the domestic stock market, Sensex fell 361.62 points to 76,907.78 in early trade, while Nifty fell 134.90 points to 23,980.60.
According to exchange data, foreign institutional investors bought shares worth Rs 2,835.62 crore on Monday. Bhansali said that the market environment remained weak after another military confrontation between US and Iranian forces in the Gulf region. The conflict began when Iranian forces launched renewed attacks in the Gulf as both sides sought to establish control over the strategic waterway.
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