While the world markets are looking for the consequences of the deterioration of the Turkish and Argentinian currencies and their impact on world markets, a new development in the same vein is raising greater fears given the size of the country’s economy.
Competent bodies classify the Indian economy as the seventh largest in the world in terms of size, which leads to serious concern about what happened to the Indian currency in recent times.
The rupee has fallen to a new record against the US dollar, despite government attempts to stop the bleeding.
The rupee reached 71.80 per dollar, an unprecedented figure.
According to reports published by the agency “Reuters” that the Reserve Bank of India has conducted some interventions in the foreign exchange market, with the aim of curbing the losses that reached levels never before.
The rupee has already lost more than 10 percent of its value this year against the US giant, but Business Insider has quoted analysts in Australian and New Zealand banking groups as saying the rupee is likely to face more negative pressure in the coming months.
Concerns about emerging market assets are mounting in the current period, as the strength of the US dollar gains support from trade tensions and tightening monetary policy.
The decline of the rupee has led to a further deterioration in the currencies of Turkey and Argentina in recent weeks.
The lira fell 43 percent against the dollar this year, according to Reuters. Pizzo Argentina, Latin America’s third-largest economy, has lost more than 45.3 percent of its value against the US currency since the beginning of 2018. This has led to broad interventions by the central bank Including the sale of reserves worth more than half a billion dollars this week.
On Wednesday, the dollar rose broadly as concerns mounted that US President Donald Trump would escalate the trade war with Beijing soon by charging more Chinese imports.
Trump may impose customs duties on new Chinese goods valued at $ 200 billion after the deadline for receiving public opinion on the new tariffs on Thursday, but it is not clear when this may happen.
The dollar received further support from strong US indices that reinforce the justification for new US interest rate increases.
The dollar gained more than 2 percent against the South African rand and the Argentine peso and more than 1 percent against the Mexican and Colombian pesos.
The dollar rose in 2018 against all major currencies except the Mexican peso and the Japanese yen.