On Tuesday, the Indian Rupee closed at a near record low of 88.79 against the US dollar, despite falling global crude oil prices. The local currency lost 12 paise during the day as it continued to slide and remains one of the worst-performing Asian currencies, down 3.72 per cent year-to-date.
Analysts noted that the rupee has been trapped in a narrow range without breaching the psychologically important 89-per-dollar mark even as it printed new lows in recent days. Meanwhile, the one-month volatility of the dollar-rupee pair has also fallen to the lowest level this year, signaling diminished movement in the markets and an overall level of stability in day-to-day trade.
From a macro perspective, India’s retail inflation fell sharply in September to a 99-month low of 1.54 per cent. Food prices fell 2.3 per cent year-on-year, indicating the most benign inflation reading for this component of household spending, which can be volatile since December 2018. However, the rupee continued to feel the pressures from global happenings, and a marginally stronger US dollar.
The dollar index, which measures the greenback against a basket of six major currencies, slipped slightly by 0.10 per cent to 99.37 as the dollar saw fluctuating.
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