BRICS: Exploring the Decline of Indian Rupee Against USD in Crypto Context

• The Ongoing Downtrend of India's Rupee Against the US Dollar
• The Rupee's Dip and the Role of Global Banks
• The Performance of BRICS Currencies
• The Future Predictions for the Rupee
• Inflow of Equity Could Improve Rupee's Stand

The Ongoing Downtrend of India's Rupee Against the US Dollar

The Rupee, the national currency of BRICS member India, sank to a new low on Monday against the US Dollar, marking its value at 83.38. This comes as the US Dollar demonstrates increasing strength against all local BRICS currencies throughout the current month. The ongoing decline of the Rupee is attributed to a mix of local and international financial pressures. Despite a strong economy, the Rupee's poor performance in the currency market is causing concern within the Modi administration.

The Rupee's Dip and the Role of Global Banks

The fall of the Rupee has occurred in the wake of sizable global banks and traders showing preference for the US Dollar over the Rupee. This strategy is likely directed by the institutional and custodial clients of these global banks. As a result, the Rupee has remained sticky in the 5-10 paisa zone near 83.30, according to a statement given by a trader to Reuters.

The Performance of BRICS Currencies

It's not just the Indian Rupee that's feeling the pinch. Asian currencies have also been underperforming against the US Dollar this quarter. Other BRICS currencies, including the Chinese Yuan, South African Rand, and the Argentine Peso, have all hit new lows in Q4 2023.

The Future Predictions for the Rupee

The Rupee's future movement is expected to be constrained within its support and resistance level, with no indication of significant shifts in either direction. Broadly, the Rupee is likely to stay range-bound, but small depreciations can't be ruled out, according to Dilip Parmar, a foreign exchange research analyst at HDFC Securities.

Inflow of Equity Could Improve Rupee's Stand

Edited by Jonathan Stoker