Business Standard

Rupee plunges to all-time low against dollar as US Treasury yields spike

The rupee declined by 17 paise to close at its all-time low of 77.71 against the US currency on Tuesday as surging US bond yields dampened the appeal of riskier assets.

Indian rupee

Photo: Bloomberg

Press Trust of India Mumbai
The rupee declined by 17 paise to close at its all-time low of 77.71 against the US currency on Tuesday as surging US bond yields dampened the appeal of riskier assets.
Losses in the domestic equities, high crude oil prices and forex outflows also weighed on the rupee.
At the interbank foreign exchange market, the rupee opened lower at 77.65 against the greenback and finally settled at 77.71, down 17 paise over its previous close.
During the session, the rupee touched an intra-day low of 77.71 and a high of 77.62. On Monday, the rupee settled at 77.54 against the US dollar.
This is the fifth straight monthly decline for the rupee amid weak risk sentiments, foreign fund outflows and concerns over high inflation.
The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.5 per cent higher at 101.92.
Global oil benchmark Brent crude futures advanced 1.77 per cent to USD 123.82 per barrel.
According to Dilip Parmar, Research Analyst, HDFC Securities, the rupee has become the worst-performing currency among Asian currencies and clocked the fifth monthly decline in a row in May on the back of foreign fund outflows and slower economic growth.
"Risk sentiments remained weak on worries over hawkish central banks following higher inflation and slower growth prospects," Parmar said.
US Treasury yields surged on Tuesday following a Federal Reserve Governor's comments that the central bank should be prepared to raise interest rates by 50 basis points at every meeting on until inflation is decisively controlled.
"Rupee traded weak as crude prices rise towards USD 120 in WTI making it more expensive for India to import," Jateen Trivedi, VP Research Analyst at LKP Securities, said.
On the domestic equity market front, the 30-share BSE Sensex ended 359.33 points or 0.64 per cent lower at 55,566.41, while the broader NSE Nifty fell 76.85 points or 0.46 per cent to 16,584.55.
In a hectic FII movement in the equities markets, foreign institutional investors sold shares worth Rs 46,741.52 crore while purchased stocks worth Rs 45,737.96 crore, leading to net outflow of Rs 1,003.51 crore on Tuesday, according to stock exchange data.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: May 31 2022 | 9:04 PM IST

Explore News