MUMBAI, Dec 18 (Reuters) – The Indian rupee hit its all-time low on Wednesday, pressured by sturdy greenback demand from importers and sure outflows from native equities, whereas intervention by the Reserve Financial institution of India curbed losses, merchants stated.
The rupee fell to 84.9550 towards the U.S. greenback earlier than closing at 84.9525, down 0.07%.
Weak spot in regional currencies forward of the Federal Reserve’s coverage determination due in U.S. buying and selling hours additionally harm the rupee alongside speculative greenback bids amid a lingering bearish bias on the native unit.
Benchmark Indian fairness indexes BSE Sensex and Nifty 50 ended decrease by about 0.6% every.
Worries over India’s progress outlook have saved the rupee beneath strain, alongside a well-supported greenback following Donald Trump’s election victory.
The greenback index was final at 106.7, and has risen over 3% because the Nov. 5 election.
Regardless of the pressures, the rupee has fared higher than most of its regional friends since then, on the again of routine interventions by the Reserve Financial institution of India.
The native unit is down 0.9%, whereas its friends have weakened between 1.8% and 4.4%.
The RBI possible offered {dollars} and carried out dollar-rupee purchase/promote swaps on Wednesday as effectively, as a part of its measures to help the foreign money.
The central financial institution has complemented spot market intervention with dollar-rupee purchase/promote swaps in current periods, possible supposed to stop the impression of spot greenback gross sales on headline international alternate reserves and INR liquidity, merchants stated.
Globally, buyers have been watching out for any modifications to Fed policymakers’ projection of fee cuts in 2025 from the September forecast, with a 25 foundation factors discount totally priced in for this assembly.
“Expectations for the ultimate Fed assembly are effectively embedded: a hawkish 25bp reduce to 4.25%-4.50%, that means a doable pause in January and fewer cuts in 2025/26,” Societe Generale stated in a observe. (Reporting by Jaspreet Kalra; Enhancing by Varun H Ok)
