Indian currency fell to an all-time low of 84.50 against one dollar!
The biggest fall in the rupee against the dollar has been witnessed so far. Due to the weakness in the rupee against the dollar in the currency market, the rupee has slipped to an all-time low of Rs 84.50 for the first time. After Donald Trump's victory in the US presidential elections, the strength in the dollar and the selling by foreign investors in the indian equity and bond market have caused the rupee to slip to its historic low.
Dollar is getting stronger due to global tensions
On Friday, november 22, 2024, the value of the rupee against one dollar in the currency market has slipped to the level of Rs 84.5025. In the month of november, foreign investors have withdrawn an investment of $ 4 billion from the indian equity and bond market. The dollar is also getting stronger due to israel - iran and russia - ukraine tensions, against which currencies around the world are getting weak, including the indian currency rupee.
Rise in US Dollar Index
The US Dollar Index, which tracks the performance of the dollar against six major currencies, has seen a jump of more than 3 percent this month. After donald trump becomes the President next year, it is believed that his policies may lead to an increase in inflation, due to which the possibility of interest rate cuts by the US Federal bank is decreasing. Due to this also the dollar is getting stronger and the rupee is getting weaker.
Inflation will increase in India!
There is a danger of inflation rising in india due to the strengthening of the dollar and the weakening of the rupee. Especially for whatever things india imports for its consumption, it may have to pay a higher price. Even though the price of crude oil has come down below $ 75 per barrel, but after the weakening of the rupee against the dollar, indian oil companies will have to spend more rupees to import crude oil by paying in dollars. india imports edible oil and pulses to meet its consumption, which will now become more expensive to import. From electronic gadgets to automobile ports, imports will also become expensive. Also, parents whose children grow up abroad will have to spend more money to send dollars to them, which will increase the burden of inflation.