Rupee hits all-time low against dollar; Omar retweets Modi’s five–year-old tweet

Mumbai: The Indian rupee crashed to breach the key psychological level of 69 in the morning trade and slipped further to hit a life-time low of 69.10, a fall of 49 paise against the US dollar during the volatile session on Thursday. However, at the end of the day the rupee closed at 68.79, showing a fall of 18 paise due to multiple headwinds like weak global cues and concerns related to inflation and fiscal slippage.

The domestic currency’s previous all-time closing low was 68.73, touched on November 24, 2016. Mad rush for dollar was witnessed as importers see further erosion in the rupee value even as it was a field day for speculative traders before the RBI came in strongly, pumping million into the market to salvage the rupee. The rupee swung between 69.10 and 68.72 most part of the day at the interbank foreign exchange (forex) market after a gap-down opening at 68.89.

The macroeconomic picture of India appears to be caught in a recurring instability against the backdrop of surging global crude prices and consistent widening in the trade deficit as well as increased pressure from capital outflows, all these leading to largely forex market turmoil.

The world’s fastest-growing major economy benefited the most from low oil prices in the recent past. Massive unwinding by foreign investors in local equity and debt markets due to change in the nation’s macroeconomic environment also dampened overall forex market sentiment. So far this year, foreign investors have sold a combined USD 7 billion in equity and debt markets.

The RBI, meanwhile, fixed the reference rate for the dollar at 68.9389 and for the euro at 79.6382. Globally, the dollar was trading near eleven-month high against a basket of the other major currencies.

The dollar index, which measures the greenback’s value against basket of six major currencies, was up at 95.05.

In the cross currency trade, the home currency edged lower against the euro and finished at 79.71 as compared to 79.70, but held steady against the Japanese yen at 62.41 per 100 yens earlier. The local unit, however staged a rebound against the pound sterling to end at 90.05 per pound from 90.45.

Meanwhile, taking a jibe at the Prime Minister, former Jammu and Kashmir chief minister Omar Abdullah retweeted Narendra Modi’s 2013 post which read, “The rupee is losing strength because those sitting in Delhi are busy in corruption.” Omar, who is the vice president of National Conference (NC), also up the ante at Modi over India being ranked as the world’s most dangerous place for women by a study.

This text was accompanied by a tweet from July 14, 2013 posted by the official handle Modi, which read, “Rupee is not losing strength because its size has changed. It is because those sitting in Delhi are busy in corruption.”