The value of rupee weakened by 8 paise on Friday to close at 2-1/2 month low of 67.44 a dollar, falling for the seventh straight session.
Friday’s depreciation, according to PTI, was because of persistent demand for the US currency from banks and importers amid higher crude oil prices and fall in domestic equities.
Foreign capital outflows also affected the rupee value against the dollar, a forex dealer said.
Weak rupee has been a major debating point among political parties in India as they tried to link it with India’s lack of economic growth.
Not so long ago, the BJP had thrown its weight behind highlighting the incompetency of Manmohan Singh, then UPA’s prime minister, whenever the Indian currency lost its value against the dollar. The party even made it a huge election issue.
Even the party’s sympathisers such as writer Chetan Bhagat and Sri Sri Ravi Shankar mocked Manmohan Singh and appeared confident that rupee will gain considerable strength as soon as Narendra Modi assumed power.
Brent crude powered back above USD 49 a barrel in Asia today as oil prices resumed their rise after the dollar eased and militants blew up another pipeline in African producer Nigeria.
On Friday, rupee resumed lower at 67.43 as against yesterday’s closing level of 67.36 at the Inter-bank Foreign Exchange (forex) market and slid further to 67.50 on initial dollar demand from importers.
However, it recovered afterwards to 67.31 before ending at more than 2-1/2 month low of 67.44 per dollar, showing a loss of 8 paise or 0.12 per cent. The domestic currency has lost 88 paise or 1.32 per cent in seven days.