The Rupee’s bearish spiral into record lows continued overnight as minutes from the latest Federal Open Market Committee meeting confirmed that policy makers are largely backing the decision to begin tapering stimulus this year.
The US Dollar to Indian Rupee Exchange Rate was in the region of 65.0500 as of 10:00 GMT
At the beginning of the week the Rupee was trading against the US Dollar in the region of 62.82, a historic low at the time. Since then the emerging-market asset has plummeted to 65.275, in spite of the Reserve Bank of India’s best efforts to restrain Rupee volatility over the last few weeks.
Following the publication of the FOMC minutes the Rupee shed 1.9 per cent against its US counterpart and declined against several of its other most traded peers.
In response to the currency’s unprecedented movement strategist Jonathan Cavenagh commented: ‘Some of the reasons for the Rupee’s fall are out of India’s control, which is probably why policy makers have stepped back a bit and let the Rupee find its own equilibrium. The longer-term issue is that India needs to suppress its current-account deficit, and that’s something policy makers should focus on by encouraging exports and investment into key sectors like retail and infrastructure.’
The US Dollar to Rupee (USD/INR) exchange rate hit a high of 65.5600
According to Westpac Banking Corp. the Rupee could fall as low as 68, or even 70, Rupee per Dollar by next week.
Yesterday the Rupee had been able to recover some ground against its US peer after the RBI announced its intention of buying 80 billion Rupees of bonds through open-market operations, but gains were fleeting.
If today’s US housing and PMI reports meet expectations, indicating that the US economic recovery is gathering momentum, the Rupee could soften further against its North American peer.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 101.2700 <
The Euro/Indian Rupee Exchange Rate is currently in the region of: 86.7404 >
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 65.0500 >
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.5384 >
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 51.1978 >
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 62.0752 >
(Correct as of 10:00 GMT)
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