The rupee could plummet to an all-time low of Rs 80 per dollar if the Russia-Ukraine war continues to escalate, according to an Economic Times report. Market trackers have claimed both the sensex and the nifty may gyrate in volatility if the ongoing crisis between Moscow and Kiev continues to linger.
Several brokerages have predicted that the rupee could fall to Rs 77.93 per dollar this calendar year. The ET report says a few of them have even claimed that their downfall could be between Rs 80 and Rs 82 per dollar this year.
This comes after oil prices soared to multi-year highs amid the Russia-Ukraine conflict, stoking fears of hyper-inflation and sluggish growth. A sharp drop in the rupee, which tumbled to an all-time low against the US dollar on Monday, and persistent foreign fund outflows added to the woes.
The rupee fell to a historic low on Monday, while bond yields surged as a sharp rise in global prices of crude oil stirred concern about domestic inflation, strengthening prospects of interest rate hikes by the central bank.
India imports more than two-thirds of its oil needs. High prices are likely to widen the country's trade and current account deficits and boost import inflation.
The partially convertible rupee ended at 76.96 against the dollar, just off its record low of 76.97 hit earlier in the session. It closed on Friday at 76.16. The rupee struck its previous record low of 76.9050 on April 22, 2020 amid the COVID-19 pandemic, according to a Reuters report.