Rupee at historic low against dollar -Tuesday June 18,2013

The rupee recorded its lowest-ever close against the dollar on Tuesday, with a fall of 1.5 per cent, ahead of the U.S. Federal Reserve’s monetary policy meeting on Wednesday June 19,2013

Resuming its downfall, the rupee on Tuesday sank by a whopping 90 paise to all-time closing low of 58.77 on massive dollar buying by banks and importers
The rupee closed at 58.77/78 per dollar compared to its previous lowest close of 58.39 recorded last week

Reason

• The widening current account deficit (CAD) continues to depress the value of the rupee

• The first four months of 2013 saw over $3.6 billion of inflows in the Indian debt segment and between May and June till date, over $3.5 billion has moved out. Such a sharp outflow within such a short period of time continues to pressure the rupee.