“Indian rupee plummeted to its lowest level in nine weeks after renewed worries about a slowdown in China and turmoil in some emerging markets resulted in rupee selloff in tandem with other emerging market currencies,” said Sugandha Sachdeva, Assistant Vice-President & Incharge — Metals, Energy & Currency Research, Religare Securities Limited.
Argentina’s currency, the peso, plunged more than 8 per cent on Thursday last against the dollar after the country’s central bank tried to stem a decline in international reserves.
“The emerging markets currency sell-off is causing a contagion effect as investors pulled money from emerging markets and other assets viewed as risky, thereby pushing the rupee down to a nine-week low of 63.34 (spot) to the dollar,” said Ms. Sachdeva.
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Moving ahead, RBI monetary policy review on Tuesday and U.S. Fed meeting on 28-29, along with Currency F&O expiry on January 29, will bring about further volatility in rupee.