• The rupee plunged to an all-time low of 69.09 against the US dollar intra-day, as fears over rising crude oil prices, portfolio outflows and tariff wars.

• Rising crude prices are a drag on the Indian economy and fuel inflation concerns, as it is a major driver of our current account deficit as India imports around 80 per cent of its crude oil requirements.
• Global crude oil prices are surging from the last few sessions after the US asked its allies to end all imports of Iranian oil by a November deadline and said it didn’t want to offer any extensions.

• The rupee was also under pressure due to drop in Asian currencies, with Chinese Yuan sliding for the 10th straight day, its longest losing streak since March 2014 after ongoing trade war between world’s two biggest economies.

• Trader fears that US-China trade war may evolve into a currency war.
• Rupee’s depreciation is in line with other emerging market currencies as the dollar index has strengthened in the wake of the U.S. Federal Reserve raising interest rates.

• The rupee, which is now one of the worst performing currencies, has lost close to eight per cent this year.

• Foreign investors have started pulling out funds from India, adding to the rupee’s bearishness, along with the spike in crude oil prices coupled with the strengthening of the dollar across the globe.

• Capital outflows of around Rs 60,000 crore — Rs 19,500 crore from the equity market and over Rs 40,000 crore from the debt market — since April this year have put severe pressure on the rupee.

• India’s current account deficit (CAD) surged over three times to $ 48.7 billion, or 1.9 per cent of the country’s GDP, in fiscal 2017-18.

• As India normally finances the current account deficit with portfolio investments and foreign direct investment, capital outflows will put pressure on the external account.

• India imports around 80 per cent of its crude oil requirements and higher crude oil prices risks widening India’s current account deficit, adding inflation risks.

• The sectors that are looking good due to the fall in the rupee are, of course, the export-oriented ones including IT and pharma.

• Federation of Indian Export Organisations (FIEO) said that the collapse of the rupee to a lifetime low against the U.S. dollar will not give an extra edge to domestic exporters, but provide a level playing field in the global market.

• FIEO director general said that the development will not provide any additional support to exporters as currencies of other emerging economies, including China, too are depreciating.

• "It will provide a level ­playing field to our exporters. It will not provide the much needed support as India is not singled out.", he added.

• The Reserve Bank of India is said to have intervened to stop the sharp fall in the rupee against the dollar.

• It is estimated to have sold dollars about $700­-800 million through state-­owned banks. 

• It is further expected that the RBI will intervene aggressively at 69.0 levels to support the rupee.

• The RBI has said that it does not target any specific level for the currency and only intervenes to curb volatility.

The Hindu, Indian Express.