October 11, 2024
New Delhi, India
USDINR
The Indian rupee slipped to an all-time low, breaching the 84/USD mark for the first time on Friday. Pressured by the recent spike in oil prices and the ongoing foreign institutional investor (FII) outflows from the equity markets, the rupee hit a low of ₹84.0525 before settling at ₹84.05. This decline surpassed the previous lifetime low of ₹83.9850 recorded on September 12.
Key Highlights
- Rupee All-Time Low: ₹84.0525/USD
- Previous Low: ₹83.9850 (Sept 12)
- Oil Price Impact: Brent crude prices surged over 10% in October.
- FII Outflows: Continued foreign money exits from Indian equities have weighed heavily on the rupee.
The Reserve Bank of India (RBI) had been actively defending the 84/USD level through market interventions over the past two months. However, the rupee’s decline reflects the growing impact of rising oil prices, exacerbated by the Middle East conflict, and diminished expectations of a large U.S. interest rate cut by the Federal Reserve.
Market Sentiment
The rupee had recovered to ₹83.50 just two weeks ago, but its near-term outlook has deteriorated with the combination of geopolitical tensions, increased oil prices, and reduced hopes of a major U.S. rate cut in November. FIIs have been net sellers of Indian equities for the past nine sessions, further contributing to the rupee’s slide.
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