Rupee Hits Record Low Of 84.11% Against US Dollar; Here Is Why?

As BSE Sensex and Nifty witnessed steep decline in trade today, the India rupee too hit its record low amid persistent foreign fund outflows. The rupee fell to its all-time low of 84.11 against the US dollar, edging past its earlier record low of 84.0950 that it touched last week.

Forex traders said the rupee is expected to trade in a narrow range during the day as the robust dollar weighs on the local unit and soaring crude oil prices pushed the local unit down, while any intervention by the Reserve Bank of India (RBI) may also support the local currency at lower levels, as per PTI report.

Meanwhile, BSE Sensex witnessed steep decline of 1177 points to 78,544 and Nifty fell 383 points to 23,921 in late afternoon trade on November 4,2024. Nifty Bank fell 470 points to 51,203 and Nifty Midcap dipped 754 points to 55,741 in late afternoon trade on Monday. All sectors have been witnessing decline in trade on November 4, 2024. Sun Pharma shares declined 5% today after US Court ruling stalled Leqselvi launch.

Earlier on Thursday (October 31, 2024), the rupee gained 1 paisa to 84.07 against the US dollar. The Forex market remained closed on Friday on account of Diwali. The local currency has been hovering around its all-time low level. It touched its lowest closing level of 84.10 against the dollar on October 11, 2024, according to a PTI report.

According to Reuters, persistent selling by overseas investors and a tepid local earnings season have weighed on local stocks, with the benchmarks down about 9% from the record high hit in late September. Foreign investors have net sold over $11 billion of Indian equities in October, while overseas investors and foreign lenders also trimmed their positions in government bonds last month for the first time since April.

The Reuters report added, "Asian currencies were mostly higher on the day, The dollar index dipped 0.2% to 103.7, likely pressured by the unwinding of long positions in the lead up to the US presidential election results. While the US election may have a "sizeable impact on equities, the RBI is likely to keep rupee volatility in check," a trader with a large private bank said.