Rupee Hits Record-Low Amid Donald Trump’s Victory & FPI Outflows

The value of rupee closed at record low of 83.39 against the dollar on reports of Donald Trump’s victory in the US presidential elections and intensive selling activity by foreign portfolio investors (FPIs). However, the intervention by the Reserve Bank of India (RBI) helped the currency in retaining its value.

Notably, the Trump-led administration is believed to favour the greenback, following which many Asian currencies have lost their sheen. Dollar Index (DXY) was trading at 105.58 on Monday, up by 0.56% over previous day’s close. So far, DXY has risen over 4.20%.

So far in November, FII outflows stood at nearly $2.80 billion, while during October it was $11.19 billion.

As per the experts, rupee will be on its track once FII selling eases. Stock markets experts also observed a moderation in FII selling, which can in turn ease the incoming blips.

Praveen Singh of Sharekhan by BNP Paribas said, “The Reserve Bank’s intervention may support the domestic currency. Moreover, traders look forward to India and the US CPI inflation data scheduled to be released this week.”

The rupee also held its ground against its peers followed by RBI’s strong intervention. Over the past few weeks, RBI has been intervening in the markets by retaining the value of the domestic currency. (By selling dollars via state-run banks).