The Indian rupee continued its freefall on Tuesday, dropping 30 paise to touch a fresh record low of 96.38 against the US dollar in early trade. The currency came under severe pressure due to rising crude oil prices and a strong US dollar, pushing the rupee into a prolonged depreciation streak over the past two weeks.
According to fresh data from investment firms, the Indian rupee’s continuous fall has now entered its eighth straight session, with the currency on a downtrend since May 7.
The rupee was trading 0.12 per cent lower from the previous session against the US greenback as of 9:30 am (IST), compared to 96.19 at the previous market close, according to USD/INR exchange data.
The major challenges for the rupee stem from the ongoing crisis in West Asia, which remains one of the main sources of oil and energy supply for the country.
India imports nearly all of its oil, out of which 80-90 per cent comes from the Gulf – a route that has been severely disrupted due to the war between Iran and the United States.
Additionally, the Reserve Bank of India is selling dollars to support the Indian rupee. So far, these measures have somewhat reduced the sharpness of the fall, but the sustained decline is still ongoing.
The Bloomberg US Dollar Spot Index (DXY) showed that the greenback was trading 0.09 per cent lower at 99.105 as of 12:03 am (ET) on May 19, compared with the previous currency market close levels.
While investors usually switch to safe-haven metals like gold and silver in such cases, the central government’s fresh austerity measures have made them almost non-profitable in the short term due to the temporary excise duty hike.
Also read: Sensex jumps 280 pts, Nifty up 26 pts in early trade
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