Rupee hits fresh low, ends at 74.39 against $

Weakens for sixth straight session The rupee weakened against the dollar for the sixth straight session, as the currency hit a fresh low amid strengthening of the greenback. The rupee declined 33 paise against the dollar to end the day at 74.39, which is a record low. The rupee opened higher at 73.93 a dollar as compared with the previous close of 74.06, but was unable to sustain after Brent crude breached the $84 per-barrel-mark again and the strengthening dollar. ‘Worst performing’ The rupee has now depreciated over 16% in 2018, making it the worst performing currency in Asia. Last week, the Reserve Bank of India (RBI), during its monetary policy review, said that targeting inflation was its sole objective and reiterated that it did not target any particular level of the exchange rate which was determined by market forces of demand and supply. “RBI’s stance on currency comes at a time when other Asian EMs (primarily Indonesia and Philippines) are actively pursuing interest rate defence for attractive interest rate arbitrage to help keep their currencies afloat,” said Madhavi Arora, economist, FX & Rates, Edelweiss Securities. Foreign flow The outflow of foreign funds exerted pressure on the rupee as foreign institutional investors (FIIs) sold shares worth Rs. 1,805 crore on Monday, provisional data showed. Concerns over worsening current account deficit due to hardening of oil prices and higher fiscal deficit have also weighed down on the currency.

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