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Hit by US elections uncertainty, rupee plunges to 2-month low
Mumbai, November 4, 2020
The uncertainty regarding the US election outcome impacted the Indian rupee which plunged to a two-month low mark during Wednesday's trade session.
The rupee hit an intra-day low of 74.88 as there were indications that the US presidential results might be contested in courts.
At around 3.15 p.m., the rupee traded at 74.80 to a greenback.
"Markets would not like a delayed result, which can lead to prevalence of more risk-off sentiment," Sajal Gupta, Head, Forex and Rates, Edelweiss Securities.
"No matter who wins, stimulus shall be coming. So expect US dollar to weaken in two weeks time after a clear win."
At the end of the day's trade, the rupee stood at 74.7462 from its previous close of 74.4063 to a greenback.
"A lack of clarity on the outcome of the US Presidential election has created a lot of uncertainties," said Nish Bhatt, founder and CEO, Millwood Kane International.
"Global equity and currency market have reacted according to it. With the US Dollar gaining strength, the Indian rupee saw a decline, as it slipped towards the crucial 75 per US dollar mark."
Rahul Gupta, Head of Research, Currency, at Emkay Global Financial Services, said: "The USDINR spot is respecting the immediate resistance of 75, but the caution and volatility will keep the appreciation intact."
"For the coming sessions, we expect USD-INR spot to trade in between 74-75.50."