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  5. Rupee hits all-time low, drops past 84 per US dollar on equity outflows, elevated oil prices

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Rupee hits all-time low, drops past 84 per US dollar on equity outflows, elevated oil prices

Upstox
By Upstox News Desk

2 min read | Updated on October 11, 2024, 12:24 IST

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SUMMARY

The rupee had recovered to near 83.50 a little over two weeks ago, but its near-term outlook has worsened as the Middle East conflict has pushed up oil prices, foreigners have been pulling money out of equities, and hopes of another large US rate cut have diminished.

The currency's decline past the 84 handle is significant

The currency's decline past the 84 handle is significant

Rupee hits all-time low: The Indian rupee fell to an all-time low of 84.0975 per US dollar on Friday, October 11, as concerns over the recent spike in oil prices and the exodus of foreign money from the equity market unnerved market participants. 

The currency's decline past the 84 handle is significant, as the Reserve Bank of India (RBI) had been defending that level.

The rupee had recovered to near 83.50 a little over two weeks ago, but its near-term outlook has worsened as the Middle East conflict has pushed up oil prices, foreigners have been pulling money out of equities, and hopes of another large US rate cut have diminished, said a Reuters report. 

The domestic unit depreciated 2 paise to close at 83.98 against the US dollar on Thursday amid sustained foreign fund outflows and elevated crude oil prices.

"However, a marginal decline in the value of the greenback against overseas currencies and a rise in the domestic equity market supported the local unit and prevented further slide in the domestic unit," forex traders said.

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"The rupee's movement has been gradual and steady, supported by the RBI's comments on its resilience and limited speculative positioning. The range for the rupee is expected to stay between 83.75 and 84.10, with the sideways trend likely to continue," PTI reported, quoting Jateen Trivedi, VP Research Analyst, Commodity and Currency, LKP Securities.

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Foreign Institutional Investors (FIIs) offloaded equities worth ₹4,926.61 crore on Thursday, while domestic institutional investors (DIIs) bought equities worth ₹3,878.33 crore, according to exchange data.

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