Record low, yet rupee falls less against other currencies; Dollar strengthened after US elections
New Delhi| The Indian rupee may have fallen to a record low against the US dollar, yet it has fallen the least against the currencies of major countries. The rupee had fallen below the 85 level for the first time. On Friday, however, it had seen an improvement of 10 paise.
Since the presidential election held in America on November 5, the currencies of all the countries have weakened against the dollar. Statistics show that the rupee has weakened by 1.20 per cent between November 5 and December 19 against the dollar. During this period, the Philippine currency has declined by 1.55 per cent, Turkiye by 2.21 per cent, Taiwan by 2.29 per cent and Thailand by 3.08 per cent.
According to the data, Indonesia’s currency has weakened by 3.72 per cent against the dollar between the period from 5 November to 19 December. Malaysia’s currency has seen a decline of 3.95 percent and South Korea’s currency has seen a decline of 4.77 percent. The euro zone currency has also broken 5.17 per cent.
Due to the fall in the Indian rupee against the dollar, the country will have to pay higher prices for imports. This will not only increase inflation further, but will also affect the country’s trade deficit. Especially at a time when inflation remains above 5 per cent.
Analysts believe that unless America’s newly elected President Donald Trump reveals his policies on the economy, the dollar will remain strong against other currencies. All Trump’s signals so far point to the US dollar remaining strong and hence the currencies of all countries will have to adjust accordingly.
After two weeks of buying, foreign investors have made a net sale of Rs 976 crore in the domestic stock market last week. However, in the first two days of last week, purchases worth 3,126 crore were made. The direction of domestic stock markets will be decided this week by global trends and activities of foreign institutional investors (FIIs). Analysts believe that there are no major developments on the domestic front in this week of low trading session. In such a situation, market participants will keep an eye on global indicators. Stock markets will remain closed on Wednesday on the occasion of Christmas. Swastika Investmart Ltd. Pravesh Gaur, senior research analyst, said, there is a lack of any major indicator on the domestic front. However, some global indicators will play an important role in giving direction to the market.
Institutional investment in Indian equity markets will continue to be strong in 2025. Brokerage house ICICI Securities estimates that institutional investments worth Rs 4 lakh crore have come into the domestic market this year. Securities said, institutional investment has played a major role in the better performance of the domestic market this year. There is a bullish trend in Nifty right now. In such a situation, it is estimated that Nifty may reach a record level of 27,500 next year. In 2024 foreign institutional investors played a large role in the market boom. Despite the withdrawal of Rs 1.5 lakh crore from the secondary market in October-November, Nifty has given 9 per cent return on an annual basis.
The report said a significant change was seen in the strategy of foreign institutional investors as these investors withdrew money from traditional sectors like banking, financial, oil and gas, while investing in capital goods, healthcare and telecom sectors.
