The Indian Rupee has plunged to yet another new record low in a week that has seen the currency make its worst performance in twenty years.
The Rupee’s dramatic decline has been caused by speculation that the US Federal Reserve is getting closer to reducing the stimulus measures that had bolstered demand for emerging-market assets. As a result foreign investors are withdrawing their funds out of India and other places such as South Africa, Indonesia and Brazil.
Since Federal Reserve Chairman Ben Bernanke first announced plans to begin reducing the Central Bank’s stimulus measures, global funds have cut holdings of Indian debt by $9.9 billion leaving the Rupee vulnerable to the nation’s record current-account deficit.
Highlighting the drastic recent decline of the Rupee was the news that India’s wealthiest man, Mukesh Ambani has been the biggest loser of the current crisis. The Rupee’s decline has erased 24% of his fortune.
On Friday the Rupee found some support after a report by Barclays Bank suggested that efforts being made by India to curb imports and improve exports could help the country to fully fund its Current Account Deficit. The report also suggests that the Rupee could recover to 61 per US Dollar over the next 6-12 months.
“Unless capital flows surprise further to the downside, we think the recent improvements in the current account deficit mean India should be able to almost fully fund its current account deficit in FY 2013-14,” Barclays said in a research note.
Current Rupee (INR) Exchange Rates:
The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 100.4528 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 85.9472 <
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 64.3269 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 57.8769 <
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 50.1619 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 60.9121 <
(Correct as of 11:00 am GMT)
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