On Friday, the Rupee lost value against the US Dollar and hit a fresh low as local sentiment remained negative against a sharply rising Dollar. The Federal Reserve has hinted at a longer-than-expected tightening cycle, which has led the dollar to rise across the board in recent days.
In the first minutes of trading on Friday, the the rupee hit a new intraday low. The local currency was trading at 81.13 at 09:25 IST. On Thursday, the rupee lost 1.1% of its value against the dollar, ending the day at an all-time low of 80.87 to the dollar.
Currency Rupees Values
The yield on the benchmark 10-year bond last traded 7 basis points at 7.38%, continuing heavy losses in government bonds from Wednesday. The movement of bond prices and returns is the opposite. Bond yields accelerated as US Treasury yields rose.
“The gradual rise in the dollar is helping global risk gain momentum. Capital flows to developing markets, particularly India, will be affected by the strengthening of the dollar against all other currencies. The surge in India was helped by the REIT’s return to buying since July. Due to REITs becoming sellers in 5 out of the last 7 days, this is now in jeopardy.
When US 10-Year Bond Yields Are Higher 3.7% and the dollar index is above 111, REITs are unlikely to buy regularly. The immediate market outlook is negative. Before investing additional money, investors may want to wait and watch,” said VK Vijayakumar, Chief Investment Strategist of Geojit Financial Services.
Reference
National benchmarks fell precipitously on Friday as recessionary concerns spread to investors around the world. The Abandoned Sensex BSE 1,021 points to 58,099 to end the week down 1.26% or 742 points. He had fallen to this point on August 29.
Friday, the NSE Nifty fell 302 points to close at 17,327. On a weekly basis, the index fell by 200 points or 1.16%. After the US Fed raised interest rates by 75 basis points on Wednesday night, both indices fell today for the third consecutive time.
The rupiah had outperformed other developing market currencies before Thursday’s dramatic decline due to a resumption of foreign equity investment, lower crude oil prices and active market interventions by the RBI.
The rupee has suffered more recently than other emerging market currencies, suggesting that the central bank has given the currency some time to adjust to the new reality of US interest rates remaining higher for longer. long time. The RBI’s foreign exchange reserves are currently at a two-year low of around $550 billion following market interventions since late February.
Indian rupee against US dollar
On Friday, the Rupee lost value against the US Dollar and hit a fresh low as local sentiment remained negative against a sharply rising Dollar. The Federal Reserve has hinted at a longer-than-expected tightening cycle, which has led the dollar to rise across the board in recent days.
In the first minutes of trading on Friday, the Rupee hit a new intraday low of 81.25 against the US Dollar. The local currency was trading at 81.13 at 09:25 IST. On Thursday, the rupee lost 1.1% of its value against the dollar, ending the day at an all-time low of 80.87 to the dollar.
The Rupee independently followed the global factors to reach its fair value yesterday, hence the lack of RBI was felt. Insufficient liquidity in the banking system, which is currently in deficit, was one of the reasons why the RBI was unable to halt the currency’s decline, according to CR Forex Advisors MD Amit Pabari.
From what he writes, “RBI’s intervention in the cash market could worsen the situation for liquidity in the banking sector in an environment of rising short-term interest rates. According to CR Forex, the rupee could fall as low as 81.80 to 82.00 per dollar in the near future.
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