Rupee closes at record low vs dollar ahead of US Fed statement
rupee closed at a record low versus the US dollar on Tuesday, joining other regional currencies which weakened against the greenback, as caution ahead of the Federal Reserve’s policy statement led to a globally stronger American currency.
On Tuesday, the rupee ended the day at 83.5650/$1 on Tuesday, an all-time closing low versus the US dollar. On Monday, the rupee had closed at 83.505/$1, LSEG data showed.
Recently released data showing a larger-than-expected jobs addition in the US has dampened hopes of the Federal Reserve lowering interest rates while sharp weakness in the Chinese yuan versus the US dollar over the past couple of days has dragged Asian currencies lower, dealers said. Higher crude oil prices and likely foreign investment outflows from Indian markets also hurt the rupee on Tuesday, dealers said.
“Stronger than expected U.S. data & political uncertainty after the French President called for snap elections pushed the EUR/USD pair lower, which in turn has pushed the Dollar Index (DXY) higher. Oil demand and rising crude oil prices are further adding to rupee weakness,” said Kunal Sodhani, vice-president, Shinhan Bank.
He said that going ahead, the rupee would likely trade in a band of 83.30-83.80/$1.
On Wednesday, the US Federal Open Market Committee will detail its next policy statement – an event that is being globally awaited to gauge when and if the American central bank will lower interest rates. A rapid increase in US interest rates since 2022 has led to the dollar strengthening globally as
