Achi news desk-
New Delhi1 day ago
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Rupee has reached its all-time record low. On Friday (March 22), it saw a decline of 35 paise against the US dollar and closed at an all-time low of Rs 83.48 per dollar. Earlier on December 13, 2023, the rupee had closed at its lowest level of 83.40 against the dollar.
According to research analyst Anuj Chaudhary, the US dollar strengthened due to the weak euro and pound. The strengthening of the dollar as well as the fall of the Chinese yuan put pressure on the rupee. Apart from this, there is a shortage of dollars in the market, which has also affected the rupee.
At the same time, Reuters quoted traders as saying that the Indian rupee reached its lowest level against the US dollar on Friday due to the decline in the overseas Chinese yuan and aggressive local dollar demand during the end of the session.
Rupee hits low even within a day
The rupee touched an intraday low of 83.52 against the dollar. Last Thursday, the rupee had closed at 83.13 per dollar with an increase of 6 paise against the American currency. While, earlier on Wednesday, the rupee had closed at 83.19 per dollar.
Rupee weakened by 1.22% so far this financial year
The rupee has weakened by around 1.22% in the current financial year (2023-24). At the beginning of the financial year 2023-2024, the rupee was at Rs 82.39 per dollar, which has now come down to Rs 83.48 per dollar.
Importing will be expensive
A fall in rupee means that importing goods is going to become expensive for India. Apart from this, traveling and studying abroad has also become expensive. Suppose, when the value of a rupee was 50 against the dollar, Indian students in America could get 1 dollar for 50 rupees. Now for 1 dollar students will have to spend Rs 83.40. Because of this, everything from fees to accommodation, food and other things will become expensive.
How is the value of a currency determined?
If the value of any other currency falls compared to the dollar, it is called falling, breaking, weakening the currency. Currency Depreciation in English. Every country has foreign currency reserves with which it conducts international transactions. The effect of an increase and decrease in foreign reserves is visible on the price of a currency.
If the dollars in India’s foreign reserves are equal to the US rupee reserves, then the value of the rupee will remain stable. If our dollar decreases, the rupee will weaken; if it increases, the rupee will strengthen. This is called a floating rate system.
