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Sunday, December 10, 2023

Indian Rupee : $1 Equals ₹83.03, Rupee Sinks To Alarming Levels

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Batori24 Bureau
Batori24 Bureau
Batori24 is a Vernacular based Assamese news portal based in Guwahati Assam. We are a dedicated news channel covering news and stories across the globe with special reference to Assam, north-east along with National and International news.

The Dollar surge or Rupee fall, as we prefer to call it, continues, pushing the Indian currency to an all-time low. Gone are the days when 80 was regarded as the psychological barrier through which the dollar’s rise should be stopped. The Indian Rupee was trading at 83.03 against the US Dollar at 3:17 a.m. UTC (8:47 a.m. IST).

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Government bond yields in India rose on Thursday, tracking a sharp rise in US yields, while the rupee’s near-record lows weighed on sentiment.

The benchmark 10-year government bond yield was 7.5076% as of 0500 GMT, having ended the day at 7.4510%.

“The entire bullishness following the minutes (of the Reserve Bank of India’s policy meeting) has been completely wiped off,” a trader with a private bank said.

“The market is bracing for debt supply tomorrow, and a daily drop below 7.50% can be safely ruled out.”

The Indian rupee fell to a record low for the second day in a row on Thursday, as the dollar’s rise on concerns about rising interest rates weighed on Asian currencies in general.

The rupee broke through the crucial 83-per-dollar level, falling to a record low of 83.20.

On Friday, New Delhi plans to sell bonds worth 280 billion Indian rupees ($3.37 billion), including 120 billion rupees of benchmark paper.

A selloff in US Treasuries pushed the benchmark 10-year yield to a 14-year high, as investors ignored a weak housing report and expect the Federal Reserve to maintain its aggressive monetary policy.

The two-year yield, which is a more direct indicator of interest rate expectations, has risen to its highest level in over 15 years.

Since March, the Fed has raised rates by 300 basis points and is expected to raise rates by 75 basis points in each of its next two meetings.

Such assertive hikes may put a lot of pressure on the Reserve Bank of India to follow suit, notwithstanding some members suggesting slowing or even stopping rate hikes after raising the repo rate by 190 basis points (bps) between May and September to combat stubbornly high inflation.

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