Rupee crashes 1.6% to 72.46 on state poll results uncertainty, Patel's exit

Adding to Monday’s losses, the rupee on Tuesday opened 1.6 per cent (Rs 1.14) lower at 72.46 against the US dollar. The domestic unit on Monday tumbled 50 paise to close at 71.32 as nagging worries on global trade war front and uncertain crude prices hurt forex market sentiment. That apart, sentiment also took a major hit after Urjit Patel resigned as the 24th Governor of Reserve Bank of India (RBI), with immediate effect. 

Besides, the trading pattern in the forex market was impacted by massive sell-offs in domestic equities as investors panicked over exit polls suggesting the Congress giving a tough fight to the ruling BJP in state elections.
 

Commenting on rupee’s slide, Rushabh Maru - Research Analyst, Anand Rathi Shares and Stock Brokers, said on Monday, “The rupee has depreciated after slew of exit polls predicted BJP is losing election in key states. This is a matter of concern as these state elections are crucial ahead of general election of 2019. The OPEC has decided to cut production by 1.2 million bpd. Hence the crude oil prices may once again move high. RBI governor resignation is going to spook the Market.”
 

In the equity market, benchmark indices Sensex and Nifty edged lower ahead of state elections outcome. The Nifty settled at 10,488, down 205 points or 1.9 per cent.  Broader market also performed in tandem with benchmarks as the Nifty midcap and small-cap lost over 2.6 per cent each.