NEW DELHI: On the back of corporate dollar outflows, the Indian rupee today plunged 1% to end at a month-low of 82.61 against the US dollar.
The dollar index, which measures the strength of the greenback against a basket of six major currencies, hung on to most of the previous session’s gains to be the last at 105.30.
“Once the spot crossed 82, stops may have been triggered by importers and bank dealers and that accentuated the rise. USDINR forward premium is trading at the lowest levels since 2011 and low forward premiums are hurting dollar supply. It is making carry trade unviable and also reducing exporter hedging. At the same time, it is making the Rupee vulnerable to global shocks,” said Anindya Banerjee, VP – Currency Derivatives at Kotak Securities.
The rupee has become one of the weakest currencies across a broad basket of currencies on a year to date basis.