As rupee sinks to historic low, Modi govt blames 'external factors'

Rupee Hits All Time Low Against USD 10 Things To Know

Attributing the fall in rupee value against the US dollar to "external factors", Economic Affairs Secretary Subhash Chandra Garg said on Tuesday that there is nothing to worry about as long as the depreciation is in line with other currencies.

"There is nothing to worry at this stage. Importers were seen aggressively buying dollars in the forward market putting further pressure on the rupee", said Abhishek Goenka, chief executive officer (CEO), India Forex Advisors. While opposition parties attacked the government, hitting back at the Prime Minister for his attacks against the UPA government in 2013 for the falling rupee, Congress chief Rahul Gandhi described the weakening to an all-time low of 70.10 as "a vote of no-confidence". The rupee has been suffering due to turmoil in the Turkey currency market raising concerns that it may impact financial institutions in Europe.

Sensex gained 207.10 points to close at 37,852 while NSE's Nifty closed at 11,435.10, up by 79.35 points.

"I feel that it (rupee) should stabilise between 69 and 70 because if you look at the numbers for investment which is coming into the country - investment in bonds, investment in equities - this level has become attractive for foreign investment", Kumar said. "On the downside, support is around 69.30 levels", Rushabh Maru-Research Analyst at Anand Rathi Share and Stock Brokers, told Moneycontrol.

He said the RBI has spent about $23 billion so far to intervene in the market.

Traders said, on the condition of anonymity, that rupee recouped some of the losses as state-run banks sold the dollar on behalf of the Reserve Bank of India.

The corresponding rates were 69.4685 and 79.1876, yesterday.

The Turkish lira has dropped to a record low against the dollar and on Monday a dollar bought just under 6.65 lira.

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