Indian rupee touches new low

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IndianRupee Reuters. An employee counts Indian currency notes at a cash counter inside a bank in Mumbai.

The Indian rupee touched a record low of 57.33 against the dollar in trading Friday, amid global risk aversion and rising demand for dollars.

The rupee opened the day at 56.80 to the dollar and plunged to an all-time low of 57.33 in afternoon trading.

It recovered marginally to close at 57.12, down 1.47 per cent from Thursday's close of 56.30 to the dollar.

Analysts said increased capital outflows from equity markets and the rising demand for dollars from oil and gold importers were pulling down the Indian currency.

Analysts and traders expect the domestic unit to hover around the level of 57-58 rupees to the dollar throughout June amid signs of uncertainty in India's fiscal and economic outlook, and renewed global risk aversion, the NDTV Profit channel reported.

Reserve Bank of India governor D Subbarao had said Tuesday that the central bank would intervene in case of volatility in the foreign exchange market.

The rupee has been falling for much of the year, after spending most of 2011 at between 44 and 45 rupees to the dollar. It fell to 53 rupees to the dollar in December, before gaining strength to around 49 rupees to the dollar in February,

Since then, it has plumbed ever lower against the dollar, with sharper declines since May. - Sapa-dpa

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