The rupee fell way past the psychological mark of 57 for the first time to 57.30 against the dollar on Friday on strong demand for the American currency from oil importers, increased capital outflows and concerns over slowdown in global economic growth.
Continuing its free fall, the rupee surpassed previous records in the five-day-long losing streak and tumbled Re 1, over 1.6 per cent from previous close to 57.30 per dollar in mid-session trade on the forex markets.
The rupee has depreciated nearly 3 per cent so far this week, its biggest weekly fall since September 23.
The dollar has also gained against the euro and other major currencies in the overseas forex markets amid global economic growth concerns, Moody’s downgrade of world’s 15 biggest banks and mounting worries over eurozone debt crisis, including the size of a bailout needed to save Spain’s banks.
The Reserve Bank of India also decided to keep all key interest rate unchanged, dampening industry as well as investor mood, adding to the pressure on the rupee.
After opening lower at Rs 56.80 against the dollar on Friday, the rupee recovered partially to 56.76 before slipping again.
It had gained from its low levels on Thursday to close at 56.30. Forex dealers said intervention by RBI and heavy selling of dollar failed to check the rupee’s free fall.
Keywords: INR-USD rate
As a common man, never know what happens? one simple common sense question; what does Finance ministry and RBI do when Rupee falls? They are resposible for this messup and can not escape by simply say world economy is down etc. NRI will be getting benefitted whenever rupee falls otherswise Indians living in India especially common man suffers a lot.
This is really interesting. Our country's rating is already being downgraded by Moody & Finch. Now, with a weak rupee, we are giving easy options for foreigners to buy anything and everything that is Indian made. Perhaps, this will boost our economy.
India is battling asset bubbles. If the government can successfully rein-in the real estate, the economy will get deflated. Rupee and inflation will self-correct. Force the builders in bringing down the prices. Differential interest rate policy adopted by China will be a good start. I would argue for higher interest rates for the Corporates. That will invariably result in lower commodity/real estate and will encourage many new innovative start-ups. Its futile to think that we need to depend on big corporations for job creation. If we control the prices many intelligent youth will be encouraged to start the business. Reset the economy before India turns Zimbabwe!!!!!!!
Indian government should increase indigeneous production of all types
of products. India should develope its own technology in every sphere.
Research is the key to success for the country and our indian
scientists and technicians will get work in our own country and will
also be proud of our country.India is mainly selling raw materials to
other countries and getting manufactured goods from other countries.
The government should reduce taxes so that the people of India have
enough money to buy the produced goods. Reduce government´s expenditure
by spending money for ministers majestic bungalows and all free
facilities. A country can only be strong if you produce enough goods
but not only services. The rupee will be up.
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