Indian rupee in spot market weakened to 15-month low of 75.67 this week hurt by fears of elevated inflation amid surging crude oil prices and stronger dollar, experts believe
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Rupee vs dollar: Amid fear of soaring inflation, crude oil price rise and stronger US Dollar (USD), the rupee has dipped to its 15-month low of 75.67 per dollar. And now, currency experts said that rupee may further go down and hit 77 per dollar levels in near term.
Crude oil prices have ascended to its 3-year high and dependency on crude imports is highly negative for the national currency against major foreign currencies including dollar, experts stated.
Speaking on INR to USD moves in the Forex market, Kaynat Chainwala - Fundamental Research Analyst Currencies at Anand Rathi said, "Indian rupee in spot market weakened to 15-month low of 75.67 this week hurt by fears of elevated inflation amid surging crude oil prices and stronger dollar. Domestic equities hitting all-time highs could not provide a cushion either. India’s CPI fell to five month low in September at 4.35 per cent, well within RBI’s comfort zone of 2 per cent to 6 per cent, providing RBI scope to continue with its accommodative policy stance to achieve sustainable economic recovery."
On why Indian rupee may not come out of the bears grip in short-term; Anuj Gupta, Vice President — Commodity & Currency Trade at IIFL Securities said, "Rupee is trading on 15-month low levels due to heavy import basket. Importing crude oil, which is trading at 3 years high, higher palm oil prices and now also starting to importing coal — are some of the major factors that impacted Indian Rupee negatively. Higher energy prices put pressure on rupee as commodity prices are rising causing inflation."
Expecting further dip in rupee against dollar, Anuj Gupta of IIFL Securities said, "We are expecting that it may depreciate further to test 76 to 77 levels very soon."
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.