The Indian rupee on Thursday, 19 May, fell 14 paise to close at all-time low of 77.75 (provisional) against the US dollar, reported news agency PTI. This comes after the rupee slid to the previous all-time low of 77.61 against the US dollar on Wednesday.
Analysts have previously stated that the rupee is weighed down by elevated crude oil prices and rate hike by the US Federal Reserve in order to tame inflation.
The rupee had previously breached 77 against the dollar for the first time, earlier this March.
Widening Trade Deficit, Supply Disruptions
The dollar index, which measures the value of the US dollar against a basket of six foreign currencies, was trading 0.3 percent higher at 103.59 on Wednesday, reported PTI.
Jateen Trivedi, VP Research Analyst at LKP Securities, said, “The dollar index took support near 103.50 and the capital market witnessed profit booking from higher levels, sending rupee into weakness.”
India's widening trade deficit, which hit record lows last week, will drag the rupee down further, as per Acuité Ratings.
The rupee's deep slump is driven by capital outflows from emerging markets amid Russia's invasion of Ukraine and the consequent Western sanctions, which have disrupted supply chains.
This has led to a surge in commodity prices and global runaway inflation, reported NDTV.
(With inputs from PTI, NDTV.)
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