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The Indian rupee slid Friday to 8 pats at 69.03 against the US dollar in the opening trade, reported the Press Trust of India (PTI). The further decline of the Indian currency is due to the appreciation of US currency abroad and sustained outflows of foreign capital. According to the currency traders, this is the third consecutive decline in the rupee which is mainly due to the demand for the US currency and a decline of the national stock market today.
Here are some things to know about the movement of the Indian rupee on the foreign exchange market:
1. The Indian currency plunged on Thursday or the second session in a row hit a closing low of 68.95, sliding 21 pence following a panic demand for the US dollar badociated with worries of flight of wild capital. Foreign portfolio investors (REITs) on Thursday sold shares worth Rs 159.37 crore, according to preliminary data.
2. The Indian currency stands out as one of the most vulnerable and underperforming currencies in Asia with a fall of nearly 8 percent in value against the rising dollar bull.
3. However, economic growth has resumed and India has retained its place as the fastest growing major economy this year, but the rupee has collapsed to a new low. standard of living June 28.
4. After an extraordinarily mild ride in 2017, the national currency has been steadily declining since April and. On July 2, the rupee had reached its lowest closing level of $ 68.80. The prospect of a global trade war has increased and oil prices have risen sharply. US crude oil futures have increased 13% since June 1st. These factors have had an impact on the movement of Indian currencies.
5. According to a Reuters poll, global trade tensions and rising oil prices are also expected to spike the rupee in the coming year. The rupee was marked by a liquidation of emerging markets, driven by the daily escalation of global trade tensions and fears of a growing current account deficit due to rising oil prices.
6. "India is obviously one of the most commodity-prone countries, especially oil imports, which slows the current account, which is fundamentally negative for the Indian rupee," Prakash said. Sakpal, economist at ING
. . According to a forex distributor, the government's announcement to raise the minimum support price (MSP) of kharif crops should also contribute to inflationary pressures in the economy and which could prompt the Reserve Bank of India (RBI) to raise interest rates are higher than expected.
8. Asian currencies and foreign exchange markets are likely to be influenced by the evolution of the current market momentum after the expiration of the deadline for the United States to impose tariffs on certain Chinese products that they import, as the Reuters poll said.
Meanwhile, other badysts also believe that the rupee will continue to stay around current levels. The planned tightening of the policy by the central bank would help the rupee, they said.
10. "The reason we think the rupee is going to strengthen is our forecast for the national monetary policy: there will be a few more rate hikes this year, which is a bit more than expected and that should support the currency, we expect a drop in oil prices by the end of the year, if that turns out to be the case, it should give the rupee some strength, "Shilan said. Shah, Senior Economist of India, Capital Economics. (D, s, id) {var js, fjs = d.getElementsByTagName (s) [0]; if (d.getElementById (id)) returns; js = d.createElement (s); js.id = id; js.src = "http://connect.facebook.net/en_US/sdk.js#xfbml=1&version=v2.5&appId=213741912058651";fjs.parentNode. insertBefore (js, fjs);} (document, "script", "facebook-jssdk");
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