Indian Rupee Falls to New Low Recovers Slightly in Mid Trading

The Indian rupee has fallen to a new all-time low against the US dollar, amid concerns the Federal Reserve will soon scale back its stimulus measures.

It dropped to 64.13 against the US dollar in early trade on Tuesday.

Foreign investors have been pulling money out of India, as the economy has slowed and the cost of borrowing in dollars has risen.

USD/INR Daily Forex Graph for August 20, 2013

via BBC

The Indian rupee has declined by nearly 16% against the US dollar since May and is Asia’s worst performing currency so far this year.

Its further decline on Tuesday was mirrored by falls in markets across other developing markets, particularly in Asia.

On Tuesday, Japan’s Nikkei 225 index fell by 2.6%, Hong Kong’s Hang Seng was down 2.2% and South Korea’s Kospi dropped by 1.6%.

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza