Rupee weakens as US Fed announces further tapering

The rupee weakened in early trades as the US Fed announced further tapering of $ 10 billion. The first round of tapering of an equal quantum was announced last month. 

 

At 9:50AM the rupee was trading at 62.82 compared with previous close of  62.42 per dollar.

 

However, market had factored in the further tapering of $10 billion due to which the weaknesses is termed as "immediate and short-term".

 

The central bank has assured that India is better prepared to face tapering due to its strong foreign exchange reserves position as current account deficit is falling.