Our Bureau
New Delhi
The Indian rupee fell to a record low on Friday and crossed the 96-per-dollar mark for the first time, as pressure from higher crude oil prices, a strong US dollar and hawkish comments from US policymakers hit the currency.
At the interbank foreign exchange market, the rupee opened at 95.86 against the US dollar and then slipped further during intraday trade. It touched 96.14, down 50 paise from its previous close, before ending the day at 95.96, according to reports.
Traders said the fall came as global uncertainty continued to weigh on market sentiment. They pointed to persistent foreign capital outflows, weak net FDI inflows and rising crude prices as major reasons behind the pressure on the rupee.
The weakness in the currency also reflected the strength of the dollar index, which stayed firm as investors looked for safer assets. Market experts said the rupee had already been under strain in recent sessions, with repeated record lows showing the pressure on India’s foreign exchange market.
The latest fall is likely to worry importers, especially oil companies, because a weaker rupee makes dollar-linked purchases more expensive. It may also add to inflation pressure if higher import costs are passed on to consumers.
The rupee’s move on Friday marked another difficult day for the currency, which has been facing steady headwinds from the global oil market, foreign fund outflows and the strong US dollar.
