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Rupee Posts All-Time Closing Low Of 69.05 Against Dollar: 10 Points
Rupee registered its biggest single-day fall since May 29 Dollar hit one-year high against global currencies Losses in rupee occurred as dollar strengthened on Fed chief's comments
19 Jul 2018, 10:35 PM IST 
The rupee is down more than 8 per cent against the dollar so far this year
- The rupee traded in the range of 69.06-68.70 during Thursday's session, before settling at 69.05 against the US dollar.
- The dollar rose to its highest level since July 2017 against six major currencies on Thursday, supported by bullish comments from Mr Powell the previous day, which affirmed expectations for more interest rate increases this year. The Fed chief, in a closely watched two-day congressional testimony, said he believed the US was on course for years more of steady growth and played down the risks of an escalating trade conflict. Most Asian currencies dropped against the dollar.
- His comments bolstered the expectations of interest rate hikes, though gradually. The US central bank raised rates in June and policymakers indicated they expect two more rate increases this year.
- Besides, domestic political uncertainty subdued the key equity indices. BSE benchmark index Sensex and the NSE Nifty closed with mild losses. A decline in global markets also weighed on the domestic indices, say analysts. (Also read: New Rs 100 note to be issued shortly. Here's what it looks like)
- Investors seemed to be "cautious ahead of a parliament debate on Friday, July 20, 2018 about a no-confidence motion" against the current NDA government, news agency IANS cited Deepak Jasani, head of retail research at HDFC Securities, as saying.
- Global cues are not clearly supporting domestic market direction and trade tensions between the US and other major economies are keeping investors on edge, said Vinod Nair, head of research at Geojit Financial Services.
- Government data earlier this month showed retail inflation - determined by Consumer Price Index - accelerated to a five-month high of 5 per cent in June. That marked a fifth straight month of consumer inflation remaining above the Reserve Bank of India's comfort level. Separate data showed wholesale inflation - based on Wholesale Price Index - stood at 5.77 per cent, the highest level in over four-and-a-half years.
- Meanwhile, trade deficit widened to a more than three-and a-half-year high of $16.6 billion during the same month.
- Credit ratings agency Icra sees the country's current account deficit - the difference between inflow and outflow of foreign exchange - widening to $16-17 billion, or 2.5 per cent of GDP, in April-June. For the full year, the gap may scale a six-year high of $67-72 billion, it noted. The current account deficit was at $15 billion in the quarter ended June 2017.
- The rupee is down more than 8 per cent against the greenback so far this year. It had touched an all-time intraday low of 69.10 on June 28.
(With agency inputs)