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Rupee may fall to an all-time low of Rs 80 per dollar, according to a report

According to an Economic Times report, if the Russia-Ukraine conflict escalates, the rupee might fall to an all-time low of Rs 80 per dollar. As per market watchers, if the existing conflict between Moscow and Kiev persists, both the Sensex and the nifty would see volatility.

Several brokerages forecast that the rupee would decline to Rs 77.93 per dollar this year. According to the ET article, some of them have even estimated that the decrease might be between Rs 80 and Rs 82 per dollar this year.

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WAR IN RUSSIA-UKRAINE

This comes after oil prices surged to multi-year highs in the midst of the Russia-Ukraine crisis, fueling worries of hyperinflation and slow development. A significant plunge in the rupee, which hit an all-time low against the US dollar on Monday, and continuing foreign money outflows exacerbated the situation, dealers told PTI.

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RUPEE AT AN ALL-TIME LOW

The rupee sank to a historic low on Monday, while bond yields rose as a strong spike in global crude oil prices fueled worry about local inflation, bolstering the central bank’s prospects of raising interest rates.

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Moreover, two-thirds of India’s oil requirements are imported. High costs are expected to exacerbate the country’s trade and current account deficits, as well as increase imported inflation.

The partly convertible rupee closed the afternoon at 76.96 versus the dollar, barely off its session low of 76.97. It closed at 76.16 on Friday. According to Reuters, the rupee hit a record low of 76.9050 on April 22, 2020, during the Covid-19 epidemic.

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