As rupee nears 80 against US dollar, how this impacts you
PremiumThe biggest impact of a weakening rupee is on inflation
As the US dollar continued its relentless rise against other major currencies, the Indian rupee today hit a record low for a fourth straight session The rupee today fell to new low of 79.74, breaching previous low of 79.66 it had hit in the previous session.
The keenly awaited consumer price index (CPI) inflation in the US came at a blistering 9.1 percent in June, the highest since November 1981. Months of soaring inflation have rocked global markets. Wednesday's CPI reading was followed by speculation the Fed could hike borrowing costs a full percentage point at its next meeting this month.
How a weakening rupee will impact investors
Asheesh Chanda, Founder & CEO, Kristal.AI, a global wealth advisory platform says that it is a clear sign that global investors are choosing the safety of US markets over the recession risks of the EU. The impending threat of Russia cutting off gas supplies in winter coupled with the slow intervention by the ECB to control inflation, means that the recession in the EU looks imminent. Hence investors are selling Euros and buying dollars. It also reinforces the importance of USD as the safest currency during times of uncertainty.
Advise for Indian investors amid weakening rupee
"As an Indian investor, one would be well advised to dollarize their investments as even rupee is expected to decline further this year," said Asheesh Chanda.
What does a weaker rupee mean for you?
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