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The Nervous Indigenous Rupee or INR tries to find its true value by plunging to its lowest level at 68.95 against the US Dollar on July 5th.
The national currency has continued its depreciation trend in recent years Friday, the rupee has slipped to touch 69.03 against the US dollar before ending at 68.87
The Indian currency was the most low since it had reached the level of 68.80 against the US dollar on August 28, 2013.
The Rupee is one of the worst performing currencies this year. Since January of this year, it has weakened more than 7 percent against the US dollar. During the same period, the rupee fell by 4.6% against the euro, by 9.7% against the yen and by 5.2% against the British pound
. foreigners sold $ 585.40 million and $ 6.10 billion Most experts believe that a weaker currency could help balance trade equations, even though fears of higher inflation in the middle of the year An election year in 2019 could put more stress on the rupee to strengthen.
A senior treasury official from a public sector bank qualifies the rupee's weakening as "turbulence". "We do not see a very scary position but not very bright too." The rupee could reach 70 years but there will be a panic [a] but, given the election year, it is a good opportunity to convert foreign currency into rupee, though "Hariprasad MP, senior vice president and chief treasurer at Centrum Direct declared Moneycontrol last week.
Fear of a slowdown in the country's economy due to rising global Crude oil prices, worsening worries about current account deficits and global trade wars have kept the rupee on the agenda
On June 28, it collapsed to a historic lows of 69.09 against the US dollar. 68.95 on Thursday, July 5th.
See also: Rupee may apply brakes if it breaks 70 / $
Incidentally, US Federal Reserve policies and a higher than expected minimum support price could stoke the economy. inflation to get up and lead to more "Asian currencies and foreign exchange markets will likely be influenced by the evolution of the current trading momentum after the expiration of the deadline for the United States to impose import duties. Customs on some of the Chinese goods that they import According to a Reuters poll, global trade tensions and rising oil prices are expected to weaken the rupee over the next year.
While Intervention of the Reserve Bank of India eased volatility, the rupee should Salil Datar, CEO of Essel Finance VKC Forex Ltd, "The United States being aggressive against possible sanctions against India for Iran's oil imports, the rupee has further weakened on Thursday. The intervention of the RBI is likely to maintain the exchange rate around 68.75-69. "
Therefore, even if the situation looks bleak for now, the fall has allowed the Rupee to find its true value because it can no longer In the meantime, RBI's intervention with reservations Reasonable forex, a possible rise in interest rates with reasonable prospects for growth may support the rupee to navigate through.
As Dharmakirti Joshi, chief economist of Crisil says, "Markets do not". do not like uncertainty and the developments of the commercial war inject uncertainty … The stages of sudden appreciation and depreciation do not last and correct themselves. "
Joshi believes that the & # 039; India is definitely not fragile.
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