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Rupee Closes at all-time Low of 77.74 against USD amid Elevated Oil Prices

Published on June 09, 2022
Current Context: Recently the rupee settled at 77.74 marginally weaker to hit a fresh all-time closing low against the US dollar. This has happened because domestic currency traded in a narrow range amid sustained foreign capital outflows and elevated global crude oil prices.
Rupee Closes at all-time Low of 77.74 against USD amid Elevated Oil Prices
  • Apart from that the hike in policy repo rate by 50 basis points in line with market expectations and maintaining the status quo on banks’ cash reserve ratio, also plays a role in the volatility of the currency.
  • According to the Clearing Corporation of India (CCIL) data, at the open, the yield on the 10-year government bonds was 7.51% and closed the day at 7.49%.
  • The market had priced in the quantum of the repo rate hike, which in turn gave elevated levels of inflation. Bond yields are expected to move in a range for a certain period.
  • As of now during the current policy, the 10-year yield was broadly stable between 7.47 and 7.5%.
  • In near future, the yield could move up to 7.75-8% as the RBI moves towards the calibrated withdrawal of liquidity.

Question:

Q.1 According to recent data Rupee closes at an all-time low of_________against USD due to elevated oil prices?
a. 77.73
b. 77.74
c. 76.05
d. 78.01
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