DOHA: The Indian rupee slid to an 18-year low to 18.10 per Qatari riyal yesterday after plunging against the US dollar (to which the riyal is pegged) to 64.30.
Foreign exchange operators said they expected the rupee to slump to Rs19.22 to a riyal by year-end.
Adarsh Shenava, from Al Zaman Exchange, told this newspaper the demand for the rupee was surging as an increasing number of Indians were remitting funds home.
He said the rupee firmed up a bit by the evening yesterday to 17.98. “Don’t be surprised if it even plummets to 70 to a dollar by 2013-end."
However, not aware that a falling rupee is causing higher inflation back home, many Indians are taking bank loans to rout money home, mainly for investment, foreign exchange market sources said.
In 1995-96, the rupee was quite strong with its rate being `9 to a riyal. Even until very recently, the rate remained stable at `12-`13.
The rupee nosedived particularly this year, shedding over 17 percent so far on India’s rising economic woes made worse by a slow GDP growth and flight of dollars from its markets due to improving investment climate in the US. International wire agencies said a yawning current account deficit may see the rupee under increasing pressure.