New Delhi. The Indian Rupee remained under continuous pressure in early trade on Monday. It fell by 41 paise and reached its new all-time low of 93.94 against the US dollar. Due to the ongoing war in West Asia, high crude oil prices and a strong dollar have weakened the rupee.
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The rupee opened at 93.84 at the Interbank Forex Market and soon fell to 93.94, registering a decline of 41 paise from its previous close of 93.53. Earlier on Friday also, the rupee had crossed 93 for the first time and closed with a huge fall of 64 paise.
double pressure of oil and dollar
According to Forex Traders, the rise in global crude oil prices has created additional pressure on the rupee. India is now paying about $50 per barrel more for oil imported from Gulf countries, due to which the import bill has increased and the demand for dollars has increased.
According to Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, the rupee has fallen sharply due to heavy demand for dollars in the market. He said that the Reserve Bank of India (RBI) remained present at different levels, but it allowed the rupee to fall because the demand for dollars was very high.
Read :- West Asia Crisis: Rupee reached its lowest ever level against dollar, fell to 92.5
FPI outflow and stock market weakness
The fall in domestic stock markets and continuous selling by foreign investors (FPIs) have also weakened the rupee. Due to risk aversion, investors are withdrawing money from Indian markets and moving towards safer options.
RBI intervention expected
Experts believe that if the rupee continues to fall, RBI may intervene. However, dollar demand from oil companies and foreign investors may remain high in the near future, which is likely to continue to put pressure on the rupee. Meanwhile, the Dollar Index is also up by 0.02% at 99.66, indicating the strength of the dollar globally.
Global oil benchmark Brent crude was trading 0.60 per cent lower at US$112.90 per barrel in futures trade. According to exchange data, foreign institutional investors sold shares worth Rs 5,518.39 crore on a net basis on Friday. Meanwhile, the RBI said on Friday that India’s foreign exchange reserves declined by US $ 7.052 billion to US $ 709.759 billion during the week ended March 13.
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