Rupee Hits Another Record Low On Steep Fall In Exports

COVID-19 has been hard on the Indian rupee that has been seeing new lows in the last few weeks. On Thursday, the domestic currency opened at a record low of 76.74 against the US dollar and fell to an intraday low of 76.86. The rupee ending at 76.79/dollar, a record closing low.

The rupee is now among the worst-performing emerging markets currencies after the South Korean Won, Malaysian Ringgit, Czech Koruna and the Mexican Peso.

10-year bond yield ended at 6.44 percent.

The decline comes after the release of official data on trade deficit that showed that India's exports plunged by a record 34.57 percent in March due to a steep fall in shipments of leather, gems and jewellery and petroleum products. Consequently, the total exports in 2019-20 down to $314.31 billion.

Merchandise exports in March stood at $21.41 billion, down by 34.57 percent compared to $32.72 billion, and is possibly the steepest fall in monthly exports since 2008-09, when shipments dipped by 33.3 percent in March 2009.

"The decline in exports has been mainly due to the ongoing global slowdown, which got aggravated due to the current Covid-19 crisis. The latter resulted in large scale disruptions in supply chains and demand resulting in cancellation of orders," the Commerce Ministry said in a statement on Wednesday.

Weakness in the Indian stock markets and strengthening of dollar (a safe haven in times on uncertainty) in the international market has been weighing on the rupee.

The previous record low of 76.48 was seen on 15 April, a day before.