business

Rupee at an all-time low for the fourth consecutive session against the dollar

The Indian rupee today hit a record low for the fourth consecutive session against the US dollar. The US dollar has continued to rise against other major currencies. The rupee today fell to a new low of 79.74, having crossed the previous low of 79.66 in the previous session. The domestic currency closed at a record low of 79.62 against the US currency on Wednesday. The foreign institutional investors continued to dump Indian equities, putting further pressure on the Indian currency.

The US dollar is a safe haven from rising fears of recession. At the same time, the rise in US inflation has also worsened the situation. Data released on Wednesday showed the consumer price index in the US rose to a 41-year high of 9.1% in June, partly due to supply chain constraints caused by the Ukraine war and rising demand.

Following the release of US inflation data, some market watchers expect the Fed to raise borrowing costs by a percentage point at its next meeting this month. On Friday, US jobs data showed strong numbers, giving the Fed more room for further growth. The Fed’s campaign to tighten monetary policy continues to push the dollar up.

A recent Moody’s report said the COVID-19 pandemic, lockdowns in China and Russia’s invasion of Ukraine combined to distort global supply chains this year and drive up prices.

The agency expects energy and food prices to peak in the next few months and then decline, but the assumption is based on the thought that military conflicts in Ukraine will not escalate.

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