On Thursday, the Indian rupee hit a new low vs the US dollar as other Asian currencies also declined due to worries about the timing and severity of the US Federal Reserve’s impending policy tightening.
The Indian Rupee dropped from 80.86 per dollar the previous day to a record low of 81.04 per dollar.
We found that the rupee was worth around 57.2189 in 2012.
Since February 24, it was the local unit’s worst single-day decline.
When Reuters contacted traders, they were unable to establish if the Reserve Bank of India had intervened in the session’s spot market.
Some dealers claim that although the RBI may have interfered to halt the rupee’s drop, the action was not very forceful.
Traders at two state-owned banks, meanwhile, categorically denied that the RBI sold dollars to stop the slide of the rupee.
The Indian Rupee suffered throughout the session as a result of the Fed’s hawkish stance.
A further surprise to the financial markets was the rate forecast, even though the Fed’s 75-basis-point rate was anticipated.
By the end of the year, according to the so-called dot plots, rates would be 4.4%, an increase of 125 basis points from the two meetings in November and December.
In addition, authorities anticipate that rates would increase to 4.6% by the end of 2023.