The Indian Rupees fall continued on Wednesday after the currency plummeted by 4% to yet another new record low of 68 to the US Dollar, making the currency the biggest casualty in the market exodus from emerging markets.
The currency’s decline has been exacerbated by the surge in oil prices which is now threatening to worsen India’s already huge current account deficit and send the nation’s economy towards its biggest crisis since 1991.
The threat of military action by the USA and her allies against the Syrian Assad regime has seen investors pull out of the riskier emerging markets and seek shelter in the safe haven currencies of the ‘Greenback’ or Japanese Yen.
“The markets are down on the imminent possibility of a US led strike on Syria, The Indian market is in a super-panic stage,” said Samir Lodha, senior partner at QuantArt Market Solutions Pvt. Based in Mumbai.
The Rupee has been also been hammered in recent months over speculation as to when the US Federal Reserve will decide to begin to taper its monetary easing programme, a programme that brought a lot of cash into the Indian economy. The talk of tapering has seen investors pull their money out of the country which has harmed the Rupee and stocks in the country.
International investors have withdrawn nearly $12bn in shares and debt from India’s markets since the beginning of June.
“This is unprecedented and we are in uncharted territory for the Rupee”, said Vishnu Varathan, an economist with Mizuho, adding that he expects the rupee to fall to the 70 mark against the US Dollar.
Current Rupee (INR) Exchange Rates:
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 105.4802 >
The Euro/Indian Rupee Exchange Rate is currently in the region of: 91.0404 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 68.0828 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 60.7176 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 52.7860 >
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 64.8339 >
(Correct as of 10:35 am GMT)
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