Rupee breaches 83, touches a 10-month low
rupee closed at its weakest level against the US dollar in almost 10 months as a rise in the greenback globally exerted pressure on Asian currencies, although likely interventions by the Reserve Bank of India reined in the pace of depreciation in the local unit. The rupee closed at 82.95 per US dollar on Monday as against 82.84 per dollar at previous close. Monday's closing marks the weakest level for the rupee versus the US dollar since October 19, 2022, Bloomberg data showed.
Intraday, the rupee weakened to a low of 83.07 per dollar, marking the first time the domestic currency had breached the 83/$1 mark since October 2022. On October 20, 2022, the rupee had weakened to an all-time low of 83.29 per US dollar. Sharp weakness in the Chinese yuan and the Japanese yen aggravated the fall in Asian currencies, while the US dollar index touched a one-month high of 103 as investors flocked to the safety of the greenback, dealers said.
Reports of Country Garden — one of China's largest building firms — missing interest payments on debt sparked risk aversion amongst investors, especially as the post-Covid economic recovery in Asia's largest economy has been patchy. «Looming bond defaults from Beijing challenge the sentiment and allow the US Dollar to cheer its haven status. The 10Y UST yields sharply rallied while offshore Chinese yuan was sharply down, at its lowest in more than a month putting pressure on rupee,» said Kunal Sodhani, vice-president, Shinhan Bank.
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