Indian currency Rupee will end the year 2021 as the worst-performing currency in Asia. Actually, the period of decline in the Indian rupee is continuing. According to the Bloomberg’s report, Rupee has become the worst-performing currency in the Asian market. The main reason behind this is the ongoing sell-off by foreign investors.
Foreign investors withdrawing money
Significantly, the dominance of sell-off means that foreign investors are rapidly withdrawing their money from the domestic stock market. The report said that the Indian rupee has weakened by 1.9 percent in the October-December quarter against the US dollar. During this period, the Indian currency has now crossed Rs 76 per dollar against Rs 74 per dollar.
Even against smaller South Asian currencies like Pakistani Rupee and Sri Lankan currency, the performance of rupee is poor. Conversely, most Asian currencies have gained against the US dollar during the past 12 months. Talking about other currencies, Chinese currency Renminbi, Philippines currency Peso, South Korea’s currency Won, Malaysia’s currency Ringgit and Thailand’s currency weight registered strong gains.
According to the report, global investors have withdrawn US $ 420 million (about Rs 31,920 crore) from the Indian stock market. This is the most capital withdrawn from any stock market in Asia. Apart from this, due to the new variant of coronavirus Omicron, there is constant pressure on the Indian stock market. Due to this, the concerns of investors have increased.
According to a report by NDTV, QuantArt Market Solutions expects the rupee to depreciate to Rs 78 per dollar by the end of March, from the previous record low of 76.9088 in April 2020. While the survey of traders and analysts of Bloomberg estimated the rupee to reach 76.50. The rupee has registered a fall of nearly 4% this year on a loss for the fourth year in a row.
Direct impact on common man’s pocket
Let us tell you that India imports 80 percent of its crude oil from abroad. Due to the weakening of the Indian rupee against US dollar, petrol, diesel and other petroleum products will be expensive due to the weakness in the rupee, which will directly affect your pocket. If the price of petroleum products will increase due to the weakness of the rupee, then freight, transport will be expensive and this will also increase the inflation on the use of the common man.