Rupee Hits Lifetime Low OF 79.78/ USD After US Inflation Gains Even Further

Rupee has been losing its vigour and this time it is on a losing streak for the fourth consecutive day. The latest factor triggering the fall in the rupee has been the US inflation numbers which came in even hotter than expected at more than 41-year high levels.

Rupee Hits Lifetime Low OF 79.78/ USD After US Inflation Gains Even Further

Rupee at day's low has marked a new low of 79.782 after opening at 79.691 per US dollar. In the previous session, rupee closed at 79.65 per US dollar.

Rupee's continuous slide is despite the fact that the crude oil has come down sharply in price. Nevertheless, the brent crude is still hovering at around $100 per bbl level.

As for the rupee outlook and strategy, ICICI Direct says "The US dollar retreated from its 20-year high despite risk aversion in global markets and hawkish statement from a Fed official. Further, CPI
data showed inflation reached a new four decade high bolstering expectations that the Fed will continue its aggressive monetary tightening policy. The market now expects even a 100 bps rate hike in
the upcoming meeting.

Rupee future maturing on July 27 depreciated by 0.05% yesterday amid a strong dollar, pessimistic global market sentiments and persistent FII outflows

The rupee is expected to depreciate today amid strong dollar and risk aversion in global markets. Market sentiments are hurt as red hot inflation in the US stoked bets that the US Fed may have to raise
interest rates much more than expected, even 100 bps. Additionally, consistent FII outflows and concerns on looming recession may hurt rupee. US$INR (July) is expected to trade in a range of 79.50-80.00".

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