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Rupee sinks below 61 against dollar

Mumbai, July 8 (IANS) The Indian rupee hit yet another record low Monday, slipping past the psychological resistance level of 61 against a dollar, due to persistent demands for the US currency from banks and importers.

The partially convertible rupee opened weak and slumped to a record low so far of 61.21 against a dollar at the inter-bank foreign exchange market in Mumbai, surpassing its previous record low of 60.76 touched on June 26.

It was trading at 60.94 at around 1.15 p.m. against its Friday closing level of 60.22 to a dollar.

Persistent demands for dollars from banks and importers continue to put pressure on the fragile Indian currency.

The Indian rupee has lost more than 10 percent of its value this year, the worst fall among the major emerging economy’s currencies.

Widening current account deficit and weak economic growth coupled with broad strengthening in the value of US dollar are the main reasons for weakness in the Indian currency.

India’s current account deficit hit a record 4.8 percent of gross domestic product (GDP) in the financial year ended March 31, 2013, while economic growth slumped to a five percent, the lowest in a decade.

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