Expats rejoice as India rupee slides to all-time low

Muscat: The Indian rupee is currently trading an all-time low of 181.25 against one Omani riyal on Monday, said the sources in money exchanges.

“Rupee has been trading very low for some time in the range of 176-179 in the recent weeks and it now touched an all-time low following the Turkey currency crisis,” R Madhusoodanan, general manager, Global Money Exchange told the Observer.

He expected the trend to continue for some time in the wake rising fuel import costs and other factors.

Reuters inputs:

The rupee on Monday touched an all-time low of 69.62 per dollar in early trade, tracking broader weakness in other emerging market currencies on concerns of a spill-over from a crisis-hit Turkey.

The Reserve Bank of India was seen intervening to stem a sharp fall in the rupee, two dealers said.

“The RBI was there to curtail the volatility in early trade, but not in a big way,” said a senior dealer at a foreign bank.

The rupee reversed marginally from its record lows to trade at 69.53 to the dollar. It had ended at 68.84 to the dollar on Friday. The 10-year benchmark bond yield rose to 7.80 per cent from its previous close of 7.75 per cent, tracking the weakness in rupee.

Investors preferred safe havens such as the U.S. dollar and the yen after a plunge in the Turkish lira sent all emerging market currencies sharply lower.

The lira has fallen about 45 percent against the greenback this year on worries over Turkish President Tayyip Erdogan’s increasing control of the economy and a deepening diplomatic rift with the United States.

“There is no point spending a lot of dollars in defending a rupee when the force of the fall is so strong across emerging markets,” said a senior forex dealer at an Indian state-run bank.

The next crucial level for the rupee is 69.80 to the dollar, he added.

Traders will also watch out for India consumer inflation data for July due after market hours for further direction. A Reuters poll estimates July inflation of 4.51 percent compared with a five-month high of 5.0 percent hit in the previous month.