The previous largest weekly decline was recorded in the week ended November 15, 2024.
The rupee declined 31 paise to settle at 90.65 against the US dollar on Friday, weighed down by geopolitical uncertainties over the US-Iran talks, and a sharp rise in global crude oil prices.
India's forex reserves declined $5.24 billion to $617.23 billion for the week ending February 9, according to weekly data released by the Reserve Bank of India (RBI) on Friday. The forex kitty stood at $622.5 billion for the week ended February 2. However, in the current fiscal, the forex reserves have increased $50.28 billion, the RBI data showed.
Foreign currency assets, a major component of the forex reserves, dipped by $3.056 billion to $258.51 billion for the week ended May 31, the Reserve Bank.
India's foreign exchange reserves fell by a significant $3.4 billion to $276.238 billion for the week ended May 7, as against $279.633 billion in the previous week, RBI data showed.
The fall in reserves was due to a sharp fall in foreign currency assets.
In the week ending July 26 foreign exchange reserves had recorded a rise of $960.2 million to $ 280.16 billion
Importers are rushing to hedge their dollar positions amid the sharp depreciation of the rupee against the American currency and expectations of further volatility even as exporters are holding off after suffering mark-to-market (MTM) losses on earlier hedges.
In response to the panic triggered by Trump's trade policies, the RBI net sold approximately $43 billion in the second half of FY25 to curb volatility, as the rupee plunged to a low of 87.95 per dollar in February this year.
'If it doesn't, it will continue with measures to infuse liquidity, signalling a new cycle,' predicts Tamal Bandyopadhyay.
Ongoing trade-war rhetoric between the US and China added some nervousness on the trading front coupled with extremely bullish dollar sentiment overseas.
This is its lowest level since August 30
Extending its losing streak for the fourth straight day, the rupee weakened by five paise to 61.01 against the US dollar in early trade today at the Interbank Foreign Exchange market on high demand for the American currency from importers.
Overall forex market sentiment suffered a sudden reversal of fortune contrary to expectation largely moving in line with local equities, reversing all early strong gains.
The currency market won't care for our moans, groans, cries and sighs. The rupee will find its own level, explains Tamal Bandyopadhyay.
The rupee is expected to become more jittery and choppy in the near-term
The US dollar index, which tracks the greenback against a basket of six major currencies, was 0.38 per cent lower at 95.41.
'It was because of the huge selloff in the Indian equities that the rupee fell so sharply against the dollar on Friday.'
The rupee had gained by 50 paise or 0.75 per cent in two weeks.
Volatile currency market sentiment across Asia following a fresh round of China's yuan depreciation further added to gloom.
The Indian rupee ended slightly lower at 64.01/02 per dollar compared with Tuesday's close of 63.98/99 per dollar due to month-end dollar demand by importers.
The gains were capped due to month-end dollar demand from importers, mainly oil firms
'You can put 25 per cent right now; put another 25 per cent when Nifty corrects another 500 points.' 'At 13,500 put another 25 per cent and at 13,000 one can get fully deployed.'
'This is a good time to restructure your portfolio because the sectors and stocks that performed in the last bull market may not perform as much now.'
This is the biggest one-day fall in the rupee since August 3, 2016
The rupee gained 28 paise on Thursday to close at 62.50.
There are two major factors behind the rupee fall - one is international and the other is domestic.
'Rate cut should reiterate RBI's commitment in providing confidence to consumers and small business.'
The rupee on Monday slipped by 5 paise to close at 63.57 per dollar on fresh demand for the American currency from banks.
For the week, the battered rupee gained 26 paise against the greenback
Dealers attributed the rupee's fall to increased demand for the US currency from importers.
Keep exit plans handy, D-day could be the second week of August, writes Sonali Ranade in Market Notes.
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