Rupee Tumbles Even More

Tax and Bills go up the hill
To fetch oily water,
Rupee falls down and breaks its crown
Common man tumbling after.

In case the above pathetic attempt at pun laced poetry didn't make it clear, on Friday the Indian Rupee fell to its lowest ever since December 2006. The Rupee ended at 44.65/66 against dollar, from the previous close of 44.35/36.

As a stock market slide triggered concerns of further foreign fund outflows, and as the common man sells his clothes to buy vegetables, the moody Sensex fell 2.8 per cent, tracking losses in other regional stock markets weighed down by fears of a global economic slowdown.

The trade deficit rose from $9.8 billion to $10.8 billion in a span of 30 days.

The highest the Rupee has ever gone against the dollar was back in November 7, 2007 when it stood at Rs 39.27. Rising inflation due to searing oil prices is the principal factor for the Rupee's fall. Its very simple maths - India imports 70 per cent of its oil... and oil purchases are in dollars... so importers now have to pay more rupees for the same amount of dollar.