The Indian rupee has reached its weakest level against the US dollar.
On Monday (November 11), the Indian rupee fell by another 1 paise against the dollar. This took the exchange rate of one dollar to 84.38 rupees in India. As a result, the value of the Indian rupee against the US dollar fell to its lowest level in history.
Earlier, last Friday, the Indian rupee fell by another 5 paise against the US dollar. As a result, the exchange rate of one dollar in India increased to 84.37 rupees. Until Monday, this was the lowest price of the Indian rupee against the US dollar ever.
But on the first day of the week, Monday, the Indian rupee fell by another 1 paise against the US dollar, taking the value of the Indian currency to an all-time low of 84.38 rupees. Forex traders say that unless the dollar index fluctuates or there is a slowdown in foreign fund flows, there is a risk that the rupee will remain under pressure.
Meanwhile, India’s central bank, the Reserve Bank of India (RBI), has sold a huge amount of foreign reserves to prevent the rupee from falling against the US dollar. But despite this, the rupee index is still trending downward.
Indian media says that the RBI has sold 26 billion dollars to prevent the rupee from falling against the dollar. The central bank of India started selling these dollars from the end of last September. It is reported that this amount of dollars has been sold within the last one month to strengthen the Indian currency.
Basically, after Donald Trump was elected as the 47th President of the United States in the elections held this November, the dollar started strengthening in the global market. As a result, the value of the Indian rupee fell significantly.
Incidentally, the RBI, the central bank of India, may buy dollars to increase the value of the rupee and sell dollars to stop the depreciation of the rupee.
Experts claim that the country’s central bank has been doing both these things for the past few months. First, the RBI bought dollars to stop the rapid appreciation of the rupee. Later, as the currency’s price started falling, the Reserve Bank started selling US dollars.
According to the RBI, the Indian currency fell to 83.97 rupees against the dollar on September 10 this year. But by September 20, the price increased and it came back to 83.49 rupees. After that, when the Reserve Bank started buying dollars, India’s foreign exchange reserves started increasing rapidly.
However, even though the foreign exchange reserves increased, the rupee’s fall could not be stopped. On September 27, the Indian currency stood at 83.67 rupees against the dollar. This rate continued to fall, and it fell further to 84.34 rupees last Friday.
And on Monday, the first working day of the week, the exchange rate fell further and the Indian rupee reached its lowest level ever.
Source: NDTV
