Rupee continues slide; hits new low of 73.80 against US dollar

Continuing with its slide, the rupee on Thursday slipped past the crucial 73.50 levels to open at 73.70 against the US dollar. Minutes later, the currency bled further and slipped to 73.80.

The domestic currency on Wednesday plunged by 43 paise to breach the historic low of 73 level as soaring crude oil prices fuelled worries over capital outflows and widening current account deficit. The domestic currency closed at a record low of 73.34, down by 43 paise or 0.59 per cent at the interbank foreign exchange.

Sharp volatility in the domestic equities and steep FIIs outflows from equity and debt segments keeping sentiments bearish for the rupee, said Rushabh Maru - Research Analyst , Anand Rathi Shares and Stock Brokers. "The dollar index is hovering around multi-months high as the Federal Reserve continues to raise interest rates aggressively. Focus would now shift to the RBI monetary policy meeting. There is a buzz of repo rate hike by 25 bps and possible change in the monetary policy stance by the RBI. More importantly, its guidance will be crucial. Market will also keenly watch whether the RBI announces any crucial measures to stabilize the rupee. In the near term, the rupee might trade in 72.50 and 73.80 range," Maru added.

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Macro headwinds continue to roil markets as rupee plunges to new low

India’s stock markets saw a fresh round of sell-offs on Wednesday after Brent crude prices climbed to a four-year high of $85 a barrel and the rupee dropped to a new low of 73.34 against the dollar.

Investors pulled out of equity markets on worries that the spike in oil prices and fall in the rupee would adversely impact the economy. Investor sentiment has already been fragile following defaults by Infrastructure Leasing & Financial Services (IL&FS), a lender to the infrastructure sector. The benchmark Sensex closed at 35,975.63, down 551 points, or 1.51 per cent, the most since March 16. The Nifty declined 150 points, or 1.36 per cent, to end at 10,858, a level last seen on July 9.

Brent crude prices were hovering above $85 a barrel — the most since November 2014 — on fears that the impending sanctions on Iran’s petroleum industry would lead to constricted supplies. Oil prices have gained 22 per cent since mid-August and are up more than 50 per cent in the past one year. The surge has come at a time when the dollar is gaining against most global currencies amid the US Federal Reserve embarking on monetary tightening.

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RBI to introduce Rs 200 note tomorrow, check out its key features

The new Rs 200 currency note will be introduced in the market tomorrow, Reserve Bank of India said on Thursday.

The new denomination has Motif of Sanchi Stupa on the reverse, with bright yellow being the base colour of the note, RBI said in a statement.

Along with the new Rs 200 note, the government has also confirmed a new Rs 50 note. The earlier Rs 50 notes will continue to remain legal tender.

"The Reserve Bank of India will issue on August 25, 2017 Rs 200 denomination banknotes in the Mahatma Gandhi (New) Series, bearing the signature of Urjit R Patel, Governor, RBI from select RBI offices, and some banks," it said.

Here are its salient features
Obverse (Front)
1. See through register with denominational numeral 200
2. Latent image with denominational numeral 200
3. Denominational numeral २०० in Devnagari
4. Portrait of Mahatma Gandhi at the centre
5. Micro letters ‘RBI’, ‘भारत’, ‘India’ and ‘200’
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