After data revealed an unexpected uptick in US services activity on Tuesday, the rupee plunged and lost value as the dollar gained overnight.
Rupee loses 80 Paise and plunges to 82.60 as Dollar surges
The rupee depreciated from its previous closing of 81.7975 on Monday to 82.6025 on Tuesday, according to data made public by Bloomberg.
Due to a significant corporate debt repayment and demand for dollars from a foreign bank counter, the rupee lost 80 paise and fell to 82.60 , compared to its previous close of 81.7975 on Monday.
The rupee has declined against all other currencies and has had a particularly poor performance over the past two days. All eyes are on the Reserve Bank of India’s (RBI) monetary policy, which will be revealed tomorrow.
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Indian markets are anticipating a 35 basis point increase in interest rates to 6.25 percent from the RBI.
Since November 21, when there were signs of increased interest rates from the Federal Bank, which were driven by encouraging US services data, the US Dollar Index has been steadily increasing.
Uptick is US services Industry and job generation activity
US has been experiencing a pick-up in its service industry and the jobs are being generated in its economy. Many analysts have pointed that US economy at present is robust and questioned whether the US will face a recession next year. On the back of surge in the US economy, their doubts that Federal Bank will cut its key rates.
On Monday, the dollar index, which measures it against major currencies globally, dropped below 104 for the first time since June 28 , but recovered and changed course after data revealed that US services industry activity increased in November, with jobs rebounding.
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