By Alok Samantaray, M.D. (RAYRC)
The Indian rupee weakened past the 95 against the US dollar to hit a fresh record low on a higher demand for the greenback, and elevated crude oil prices above $124 per bbl. on Thursday, April 30. Data collected from the Bloomberg US dollar spot index (DYX) showed that the US greenback was trading 0.06% higher at ₹99.021 as of 2:30 am (ET) on April 30, compared to the previous market close.
Dollar demand rises in the market as investors pull out funds from the emerging market currencies, like that of the Indian rupee, triggering a massive sell-off in domestic equities as well. NSE data also showed that the foreign investors sold ₹2,468.42 crore worth of assets in the domestic capital market segments, while the domestic buyers purchased ₹2,262.17 crore in a single day.
The Indian rupee fell to around 95.1 per dollar, marking a fresh record low as mounting external pressures continued to strain currency markets. The currency is now heading toward its third straight weekly loss despite central bank efforts to curb speculation. The dollar’s renewed strength, driven by signals from Federal Reserve officials, maintained its appeal to investors even as rates were left unchanged. Traders said weak foreign inflows are reinforcing a persistent downward trend.
Looking ahead, stabilizing the rupee may become more difficult. Analysts pointed out that the challenge is no longer just speculative pressure but a broader shortfall in capital inflows. Projections now suggest a gap of around $40 billion to $50 billion for the current fiscal year, significantly wider than in recent years.
