NRI alert: Indian rupee falls to a new all-time low against UAE dirham

Negative trend in the Indian equities and firm American currency sapped investor appetite, forex traders say

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File photo

A Staff Reporter

Published: Mon 10 Oct 2022, 8:50 AM

The Indian rupee depreciated 39 paise to an all-time low of 82.69 against the US dollar (22.53 versus the UAE dirham) in early trade on Monday as elevated crude oil prices and risk-averse sentiment among investors weighed on the rupee.

Moreover, a negative trend in the Indian equities and firm American currency sapped investor appetite, forex traders said.

At the Indian interbank foreign exchange, the rupee opened at 82.68 against the greenback, then slipped further to 82.69, registering a fall of 39 paise over its previous close.

On Friday, the rupee depreciated further by 13 paise to hit a new lifetime closing low of 82.30 against the US dollar.

“The double whammy of higher US rates and higher crude prices is back to haunt the rupee. While the RBI (Reserve Bank of India) was able to defend the rupee successfully through the last round of simultaneous stress on current and capital accounts by spending its reserves, this time around things are likely to be different,” IFA Global Research Academy said in a note.

India’s forex reserves dropped by $4.854 billion to $532.664 billion as on September 30, the Reserve Bank said on Friday.

“After having exhausted a significant portion of its reserves, RBI seems concerned about the burn rate of reserves and appears to be spending them very judiciously. This has resulted in the rupee adjusting and aligning itself with fundamentals and its peer group currencies,” IFA Global Research Academy’s note said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.02 per cent up at 112.81.

Global oil benchmark Brent crude futures fell 0.87 per cent to $97.07 per barrel.

On the Indian equity market front, the 30-share BSE Sensex was trading 646.25 points or 1.11 per cent lower at 57,545.04, while the broader NSE Nifty fell 192.10 points or 1.11 per cent to 17,122.55.

Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs22.5 billion, as per exchange data.

(With inputs from PTI)


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