The Indian rupee suffered the worst fall in 16 years in November, plunging nearly 7 percent and hitting a record low, as persistent dollar demand from importers and portfolio outflows due to global risk aversion pounded the local unit. The rupee continues to face further depreciation threats on the back of a gaping current account deficit and slowing growth.
The worst performer among its Asian peers, the rupee has lost 6.7 percent during the month, taking its fall so far in 2011 to 14.37 percent. On Wednesday, the rupee closed at 52.20/21 per dollar, 0.35 percent weaker than Tuesday's close, recovering from the day's low of 52.42 after China cut its banks' reserve requirement ratio by 50 basis points, which aided global risk appetite. The one-month offshore non-deliverable forward contracts were quoted at 52.57.
The one-month onshore forward dollar premium was at 28.75 points from 29.75 on Tuesday, the three-month was at steady 64 points, and the one-year premium was at 165.25 points, from 165. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange were at 52.4675, 52.4750, and 52.4700, respectively. Total volume was at $4.99 billion.
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