The Indian rupee tumbled to a record low on concerns that slower domestic growth will hurt the inflow of money.
Global funds sold $78 million more of local shares than they bought in the June 18 – 22 week, according to Bloomberg. The rupee fell 1.5 per cent to 57.15 per dollar, but fell as much 1.8 per cent at its lowest.
The nation’s finance ministry asked Fitch for a ratings upgrade back in May in an effort to stem the decline of the Rupee. But Fitch revised its outlook on the country’s credit rating to ‘negative’ earlier this month.
And there are few signs of hope at the moment. The Reserve Bank of India said it wouldn’t lower interest rates (though it would stand ready to) because there are many factors playing into the slowdown in the economy, namely a decline in investment.
What’s more? Earlier this year Jefferies analysts Nilesh Jasani and Piyush Nahar wrote that the collapse in the country’s investment cycle is “far from being played out”.
Here’s a chart that shows the rupee’s decline against the dollar in the past week:
Photo: Yahoo Finance
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