Published: Fri, October 05, 2018
Money | By Ethel Goodwin

Indian rupee collapses to 73.77 against United States dollars

Indian rupee collapses to 73.77 against United States dollars

Indian rupee firmed up marginally near 73.50 on Friday ahead of RBI's policy announcement. "It's not breaking - it's Broken".

Gandhi Wednesday hit out at Prime Minister Narendra Modi questioning his silence over the falling value of the Indian Rupee.

The RBI said that oil prices "remain vulnerable to further upside pressures, especially if the response of oil-producing nations to supply disruptions from geopolitical tensions is not adequate".

"Fuel and gas prices are on fire and markets are scurrying". Indonesia's central bank governor stressed the need to raise interest rates before the Fed to avoid "drastic" capital outflows in the wake of a heavily flagged Fed hike in December.

The rupee collapsed to a fresh low of 73.77 against the United States dollar on Thursday, as global oil prices continued to rise, deepening concerns about the current account deficit and capital outflows.

The Reserve Bank of India (RBI) in its fourth bi-monthly meet today left the repo rate unchanged at 6.50 per cent while the reverse repo rate remains at 6.25 per cent. India imports more than two-thirds of its oil needs.

He said: "You can not wish away the depreciation in the rupee if you are a current account deficit country".

DBS economist Radhika Rao also predicted a rate hike.

The 10-year benchmark bond yield fell to 8.08 percent from 8.13 percent before the policy was announced, as traders expected a rate hike were caught wrong-footed.

The dollar rose to near 1-month highs against global currencies.

US Treasury yields jumped to multi-year peaks on Wednesday, with the 10-year yield reaching a seven-year high after Wednesday's robust data bolstered the case for the Fed to raise interest rates again in December and beyond.

Brent crude is trading near $87 per barrel - a level last seen in October 2014.

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