In early January 8 trading, the Indian rupee fell 9 paise to a record low of Rs 85.83 versus the US dollar, which is 0.069 percent less than the all-time low of Rs 85.77 reached on January 4. The strengthening of the US dollar and the increase in the price of crude oil caused the rupee’s depreciation.
The slow market activity in the domestic equity market, which put pressure on the Indian currency, is another significant factor contributing to the decline. The US election campaign in late October 2024 caused the Indian rupee to drop, and Trump’s victory on November 5, 2024, further strengthened the situation.
Initially trading at Rs 85.82 versus the US dollar, the rupee fell to Rs 85.83 at the interbank foreign exchange, 9 paise below its previous closing. The dollar index, on the other hand, was up 0.09 percent at 108.48.
The Indian government’s recent revelation that the nation’s economic growth in 2024–25 is predicted to decline to a four-year low of 6.4%, primarily due to poorer performance in manufacturing and services, is another factor supporting the downward trend. This is less than the 6.6% growth the Reserve Bank of India forecast in December 2024.
With a growth rate of 6.4%, the GDP will expand at its slowest rate since the COVID-19 pandemic, when the nation’s GDP contracted by 5.8%. In the most recent fiscal year, which concluded in March 2024, it was 8.2%.
According to exchange data, on a net basis, foreign institutional investors (FIIs) sold out Rs 1,491.46 crore in the capital markets on Tuesday.
