Rupee slumps to 32-month low against dollar

November 18th, 2011 - 9:23 pm ICT by IANS  

Pranab Mukherjee Mumbai, Nov 18 (IANS) The value of Indian rupee slumped to Rs.51.30 against the US dollar Friday, the lowest in 32 months, due to increased demand for greenback from importers, fall in stock markets and continued concerns over inflationary pressure.

The Indian rupee fell 0.7 percent, the lowest since March 2009. The rupee has depreciated almost 14 percent against the greenback in four months.

The continuous slide in rupee may prompt the Reserve Bank of India (RBI) to intervene in the currency market.

“The RBI governor is watching the situation. As and when it is necessary, they will intervene,” Finance Minister Pranab Mukherjee said.

The fall has made imports costlier and will boost exports.

Selling pressure in Indian equities markets has also led to the southward move in the value of the currency.

The benchmark indices fell for the seventh straight day, closing at a three-and-half month low Friday as concerns about the European debt crisis continued to plague investors.

The 30-scrip sensitive index (Sensex) of the BSE fell 0.55 percent at 16,371.51 points.

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