The Indian rupee started the day without much change and dropped to a record low of 83.80 against the US dollar on Monday due to a cautious approach in global markets, which favoured the dollar.
As per forex traders, the sharp decline in the Indian currency was influenced by a significant downturn in the Indian stock markets and substantial outflows of foreign funds.
At the interbank foreign exchange market, the rupee began at 83.78 and then declined to an all-time low of 83.80 against the American currency, marking a decrease of 8 paise from its previous closing value.
On the previous Friday, the rupee ended 1 paisa higher at 83.72 against the US dollar in a trade limited to a specific range. Last week, major global stocks witnessed a substantial sell-off. The release of the US Jobs Report last week, which fell well below expectations, sparked concerns about a recession in the market, leading to increased demand for safe-haven assets.
Moreover, the forthcoming US elections in November are expected to keep investors vigilant. Meanwhile, tensions are mounting in the Middle East following the assassination of Hamas leader Ismail Haniyeh in Tehran.
The Indian rupee has remained largely south of the 83.70 level despite the weakening of the US dollar. Additionally, oil prices saw an 11 per cent correction.
"However, despite these favourable conditions, the rupee has not appreciated, likely due to the Reserve Bank of India capping its movement. In the short term, the Rupee is expected to trade within the range of 83.75 to 83.90," CR Forex Advisors MD Amit Pabari said.
Follow us
