Breaking News: Rupee Approaches 88/$ Mark as Gold Prices Soar to Rs 88,000 – Insights from The Times of India

MUMBAI/HYDERABAD: Investors felt uneasy on Monday as US President Donald Trump announced more trade tariffs. This caused the rupee to hit a new low, falling close to 88 rupees for each dollar. By the day’s end, it improved a bit, closing at 87.48. Meanwhile, gold prices approached a staggering Rs 88,000 for 10 grams, nearing an all-time high.

On Dalal Street, the sell-off affected the major stock indices, with the Sensex dipping 548 points, or 0.7%, to 77,312. Smaller stocks suffered even more, with the midcap index down 2.1% and the smallcap index down 2.3%.

Data showed that foreign portfolio investors sold off stocks worth Rs 2,464 crore on Monday. In total, they have withdrawn nearly Rs 90,000 crore from the market this year alone, contributing to the rupee’s ongoing weakness.

Jateen Trivedi from LKP Securities noted that the rupee’s decline can be linked to these consistent foreign fund outflows following the recent Budget announcements and the Reserve Bank of India’s (RBI) policy, which lacked strong reforms. He also mentioned that we can expect the rupee to remain volatile, fluctuating between 87.25 and 88.

In the gold market, prices soared as gold hit an intraday high of $2,911 per ounce on the international market. This prompted prices in local markets to rise by over Rs 1,000 in a single day, bringing them to over Rs 87,250. HDFC Securities explained this spike as a shift towards gold as a safe investment amidst growing uncertainties.

In August 2020, when gold reached $2,019 per ounce, the rupee was valued at about 75 to the dollar. Surendra Mehta from the Indian Bullion & Jewelers’ Association mentioned that the current surge in gold prices has scared customers away from the market, causing a significant 80% drop in walk-ins. This is creating challenges, even as gold leasing rates continue to rise.

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Trump trade tariffs,Rupee to dollar exchange rate,Indian stock market news,gold price in India,foreign portfolio investors,Dalal Street