The value of the Indian rupee recorded a new low when it fell to 72.17 against the United States (U.S.) dollar, on the 26th of August, down by 58 paise from the previous record.
The fall of the Indian currency against the dollar is said to be the lowest record so far in 2019.
On the 23rd of August, the Indian currency ended at 71.66, up by 15 paise, however, the domestic currency again fell by 58 paise in early trade on the 26th of August.
The domestic currency has been falling repeatedly in the last few weeks and the trend is predicted to continue in the upcoming days.
The reason cited behind the free fall is the steady demand of dollars from banks and importers’ and oil refineries’ rise in crude oil prices. The frequent fall of the Indian currency also resulted in a fall in onshore trade by 7.1487 Yuan (Chinese currency) against the United States dollar.
Another reason for the fall of the Indian rupee against the U.S. dollar is the trade war between the U.S., and China.
A forex advisory firm IFA Global said, “In another round of escalation in US-China trade war, both sides increased tariffs further… This escalation has dampened risk sentiment globally.”
On the 26th of August, the Bar Stock Exchange’s (BSE) benchmark index Sensex was affected by the depreciation. The BSE opened at 36,967.36 points, whereas the National Stock Exchange’s (NSE) Nifty opened at 10,894.30 points.
Stay tuned for further updates.