The Indian rupee slipped past the psychological $63 mark to hit a 13-month low today as banks increased dollar purchases after a weak trade data sparked concerns over the country’s exports and a sell-off in most emerging market currencies also weighed.
On Monday after market hours, government data showed that trade deficit widened by 26% to $16.86 billion in November, the highest since May 2013. In early trade, the rupee hit 63.40/$, the lowest since November 2013.
While intraday, the currency can recoup some of its losses on the back of dollar sales by exporters, the weakness in most global currencies will continue to weigh on the rupee.
On Monday, the Indonesian rupiah had hit a 16-year low of 12698/$ after a sell-off in the sovereign bond market. The rupiah was trading steady today. Other Asian currencies such as the South Korean won, Phillipine peso, Malaysian ringitt and Thailand baht continued to be weak against the dollar. The composite dollar index was at 88.33, steady compared with Monday’s levels.
The currency recouped marginally and was trading around 63.40/$ in noon trade. According to some currency dealers, public sector banks were seen selling dollars around 63.45-63.50/% level at the behest of the Reserve Bank of India.