Rupee posts major decline

02-20-2009 15:47

Asian markets followed the US stock markets slump as the Indian rupee dropped against the US dollar, which may result in this year’s worst weekly decline. Presently the Bombay Stock Exchange benchmark index (SENSEX) is falling by more than 2.5%, which resulted in foreign investment funds converting the rupee the Indian dollar and selling their Indian stocks. The rupee is presently reaching its 11-week weakest level against the US dollar.

Negative prospects rupee

Analysts don’t expect the rupee to grow at short notice as the country’s officials believe that the influence of the recession on the Indian economy will exceed the expectations. It is to be expected that the capital outflows continues to be a big threat for the INR, which probably result in many speculative positions trading against it.