Rupee touches another all-time low at 53.96
15 May 2012 5:42 AM GMT
The rupee closed at all-time low of 53.96 against dollar on Monday amid rising inflation and risk aversion by global investors who bet on the US currency as a safe haven in view of fresh euro-zone worries.
Forex dealers said that intense dollar demand from banks and importers, mainly oil refiners, in view of higher dollar overseas affected the rupee value against the dollar, despite the Reserve Bank of India (RBI) steps last week to stem the fall.
The inter-bank foreign exchange market was abuzz with speculation of another intervention from the RBI. T S Srinivasan, general manager (treasury) of Indian Overseas Bank, said that the central bank was believed to have intervened initially in the market on Monday. 'Announcement of open market operation (OMO) today by the RBI indicates that it will intervene in the market in the near future. I think it is likely to intervene [on Tuesday],' he added.
The IDBI Bank treasury head N S Venkatesh said that the rupee slide was caused mainly due to continuing uncertainty in the euro-zone, which prompted strengthening of dollar against the euro. 'Also, risk aversion mode is another contributing factor for the fall,' he added.
The rupee resumed lower and dropped further to end at all-time closing low of 53.96 per dollar, showing a loss of 33 paise, after inflation rose to 7.23 per cent in April. Srinivasan said, 'Fundamentals continue to be bad for the domestic currency. Also, inflation data further dampened the sentiment.'
The rupee declined further to 86.72/74 against the pound sterling from last Friday's close of 86.40/42 and also moved down against the euro to 69.44/46 from 69.38/40. It remained weak against the Japanese yen to 67.62/64 per 100 yen from last close of 67.10/12.
Forex dealers said that intense dollar demand from banks and importers, mainly oil refiners, in view of higher dollar overseas affected the rupee value against the dollar, despite the Reserve Bank of India (RBI) steps last week to stem the fall.
The inter-bank foreign exchange market was abuzz with speculation of another intervention from the RBI. T S Srinivasan, general manager (treasury) of Indian Overseas Bank, said that the central bank was believed to have intervened initially in the market on Monday. 'Announcement of open market operation (OMO) today by the RBI indicates that it will intervene in the market in the near future. I think it is likely to intervene [on Tuesday],' he added.
The IDBI Bank treasury head N S Venkatesh said that the rupee slide was caused mainly due to continuing uncertainty in the euro-zone, which prompted strengthening of dollar against the euro. 'Also, risk aversion mode is another contributing factor for the fall,' he added.
The rupee resumed lower and dropped further to end at all-time closing low of 53.96 per dollar, showing a loss of 33 paise, after inflation rose to 7.23 per cent in April. Srinivasan said, 'Fundamentals continue to be bad for the domestic currency. Also, inflation data further dampened the sentiment.'
The rupee declined further to 86.72/74 against the pound sterling from last Friday's close of 86.40/42 and also moved down against the euro to 69.44/46 from 69.38/40. It remained weak against the Japanese yen to 67.62/64 per 100 yen from last close of 67.10/12.
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