Robust US greenback, home sell-off push rupee to all time low of 84.50

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Nov 21, 2024 11:00 PM IST

International buyers seek for a protected haven amid rising geopolitical uncertainty in Ukraine. The home sell-off was fueled by weak company earnings.

Indian rupee depreciated eight paise on Thursday to settle at an all-time low of 84.50 towards the US greenback. The forex was dragged down by an enormous sell-off in home fairness markets and rising crude oil costs amid geopolitical uncertainity.

A cashier shows the brand new 2000 Indian rupee banknotes. (file)(REUTERS)

Foreign exchange merchants mentioned the US greenback strengthened as international buyers proceed to purchase the forex searching for a protected haven amid escalating rigidity between Russia and Ukraine. The continual outflow of overseas funds additionally added to the woes of the Indian rupee.

“We expect the rupee to trade around 84.5 against the dollar by the end of December. A strong dollar continues to create a depreciating bias for currencies globally and is likely to sustain FPI outflows from Indian markets in the near-term. However, interventions by the Reserve Bank of India (RBI), supported by India’s healthy foreign exchange reserves, should help keep rupee volatility in check,” Rajani Sinha, Chief Economist, CareEdge Rankings, instructed PTI.

The Overseas Portfolio Buyers (FPI) pulled out roughly USD 4 billion from Indian markets in November, following a report USD 11 billion outflow in October.

Excessive US treasury yields and a strengthening greenback have contributed to those outflows. Home components like weak company earnings and excessive valuations are added causes.

Jateen Trivedi, a analysis analyst at LKP Securities, mentioned the US authorities’s allegations towards the Adani Group additionally fuelled the sell-off within the home markets.

In accordance with knowledge from the exchanges, FIIs have been web sellers within the capital markets on Thursday, as they offloaded shares price ₹5,320.68 crore.

The 30-share BSE Sensex tumbled 422.59 factors, or 0.54 per cent, to shut at 77,155.79 factors, whereas Nifty tanked 168.60 factors, or 0.72 per cent, to settle at 23,349.90 factors.

(With PTI inputs)

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