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Rupee ends considerably weaker against dollar

05 Jul 2022 Evaluate

Indian rupee tumbled against dollar on Tuesday amid concerns of a wider current account deficit coming time. Sentiments were fragile with preliminary data released by the commerce ministry showing that India’s merchandise trade deficit surged to a new high of $25.6 billion in June amid slowing demand for Indian exports and rising imports of gold, coal and crude oil. Exports grew 16.8 per cent year-on-year to $38 billion in June while imports jumped 51 per cent to $63.6 billion. Meanwhile, India's dominant services industry expanded at the fastest pace in over eleven years in June amid strong demand but stubborn inflation remains a concern as prices charged rose at the sharpest rate in almost five years. The S&P Global India Services Purchasing Managers' Index rose to 59.2 in June from 58.9 in May, its highest since April 2011. On the global front, euro sank to a two-decade low versus the dollar on Tuesday as a jump in natural gas prices reignited worries about the eurozone economy and data showed business growth in the region slowed sharply in June.

Finally, the rupee ended at 79.33 (provisional), weaker by 38 paisa from its previous close of 78.95 on Monday. The currency touched a high and low of 79.38 and 79.02 respectively.

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