The Indian rupee has fallen to its lowest level in six months, renewing concerns about the government’s finances and the longer-term outlook for an economy that is just gaining traction.
On Wednesday, the rupee fell to 55.62 against the dollar, the lowest level since late November, as part of a dollar rally against major global currencies.
The rupee hit an all-time low of 57.33 against the dollar last year as India’s economy slowed to its weakest growth in nearly 10 years. But foreign investors turned optimistic this year that the worst of the slowdown was over, pouring US$18.8 billion into Indian stocks and bonds so far–up by around 50% on year–which helped support the currency. Meanwhile, the Reserve Bank of India began cutting interest rates in January after a three-year battle with inflation.
The rupee hit an all-time low of 57.33 against the dollar last year as India’s economy slowed to its weakest growth in nearly 10 years. But foreign investors turned optimistic this year that the worst of the slowdown was over, pouring US$18.8 billion into Indian stocks and bonds so far–up by around 50% on year–which helped support the currency. Meanwhile, the Reserve Bank of India began cutting interest rates in January after a three-year battle with inflation.
