Indian rupee sees a sharp fall, touches a record low of 71.78 per dollar: what is on share market?

After witnessing a positive opening, the rupee has resumed its downward momentum and hit a fresh record low of 71.62.

After witnessing a positive opening, the rupee has resumed its downward momentum and hit a fresh record low of 71.78.

The currency had opened higher by 18 paise at 71.40 per dollar against its previous close 71.58. It plunged 37 paise to end at a record low of 71.58 on Tuesday.

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“The rupee continues to make a new record low on account of the crisis in the emerging market currencies. The further consistent rise in the crude oil prices and dollar index has kept sentiments bearish. There are talks of rupee moving towards 72-73 levels hence there are a lot of speculative dollars buying in the market which is driving the currency lower every day,” Rushabh Maru - Research Analyst at Anand Rathi Shares and Stock Brokers said in a statement.

Oil prices rose as the market prepared for potential supply disruptions due to a hurricane forecast to hit the U.S. Gulf Coast.

Both benchmarks jumped earlier after the evacuation of two Gulf of Mexico oil platforms in preparation for Tropical Storm Gordon. The storm was expected to become a hurricane before it makes landfall as a Category 1 hurricane near the Mississippi-Alabama border.

Vessel traffic along the U.S. Gulf Coast on Tuesday was under restrictions ahead of Gordon.

The Gulf of Mexico is home to 17 percent of U.S. crude oil production and 5 percent of natural gas output daily, according to the U.S. Energy Information Administration. On land, the Gulf Coast serves as a major U.S. refining hub.

"Crude oil prices retraced from higher levels as the impact of a tropical storm on US Gulf coast production was not as strong as initially expected. Today, USD-INR pair is expected to quote in the range of 71.20 and 71.80, analysts at Motilal Oswal Securities wrote in their report.

The US dollar rose broadly and investors shunned emerging market currencies as concerns about the US-China trade situation boosted safe-haven demand for the greenback

The dollar index, rose 0.27 percent, with the euro down 0.32 percent to USD 1.1586. The Canadian dollar also weakened to a six-week low against its US counterpart. The Canadian dollar fell 0.64 percent versus the greenback at 1.32 per dollar.

The dollar rose over 3 percent on the South African rand, and 1 percent against Turkey's Lira.

Source:- Money Control