Rupee Rupee tumbles to lifetime low as US dollar surges on Donald Trump's early lead in US election results
New Delhi/IBNS: The Indian rupee on Wednesday (Nov. 6) hit a record low as preliminary US presidential election results strengthened the dollar and weighed on Asian currencies.
The rupee slid to 84.1725 against the US dollar, a 0.07 percent drop from its prior close of 84.1075, and was last recorded at 84.17.
The dollar index rose by nearly 1.5 percent, reaching a four-month peak of 104.9, while Asian currencies fell as much as 1.2 percent.
Early election trends pointed to an advantage for Republican candidate Donald Trump, fueling a surge in so-called "Trump trades."
US Treasury yields also increased, with the 10-year yield climbing by 15 basis points to 4.44 percent.
Media projections indicated Trump had potentially secured 198 electoral votes, leading Kamala Harris, who was projected at 112 votes, while results from key battleground states remained pending.
The strength in the dollar is exerting pressure not only on the rupee but on other emerging market currencies as well.
Despite this, the rupee has remained one of the more resilient emerging market currencies this year.
Reports suggest that the Reserve Bank of India (RBI) has used over $10.8 billion from India’s foreign reserves—the fourth largest in the world—to shield the currency from election-driven volatility.
India holds Asia’s largest foreign exchange reserves after China.
If Donald Trump secures the US presidency, markets anticipate a shift back to protectionist policies in the US, which could broadly affect emerging markets dependent on American export revenue.
On Tuesday (Nov. 5), the rupee hit its lowest value of 84.13 against the dollar before recovering slightly by the day’s end.
However, continued dollar strength might drive the rupee to a new all-time low.
Support Our Journalism
We cannot do without you.. your contribution supports unbiased journalism
IBNS is not driven by any ism- not wokeism, not racism, not skewed secularism, not hyper right-wing or left liberal ideals, nor by any hardline religious beliefs or hyper nationalism. We want to serve you good old objective news, as they are. We do not judge or preach. We let people decide for themselves. We only try to present factual and well-sourced news.
