India’s rupee sank to a record as investors favored the dollar on speculation U.S. policy makers will rein in asset purchases, potentially leaving the Asian currency more vulnerable to a widening current-account deficit.
The rupee weakened the most in a month after a report showed American employers took on 175,000 workers in May, more than the 163,000 median forecast in a Bloomberg survey. The shortfall in India’s current account, the broadest measure of trade, widened to an unprecedented 5 percent of gross domestic product in the year ended March 31, the government estimates. The Dollar Index, which tracks the greenback against the currencies of six major trading partners, rose for a second day.
“We seem to be set for a weakening rupee all this week,” said Nick Verdi, a strategist at Barclays Plc in Singapore. “One reason is the strengthening dollar and the other is India’s fundamentals.”
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