The rupee struck a new all-time low versus the dollar in early trade on Tuesday, trading at 77.78/$, as the dollar strengthened against other foreign currencies, prompting investors to seek safe haven assets.
This is the second trading session in a row that the Indian currency has dropped to new lows. The rupee touched an intraday low of 77.63/$ on Friday, the preceding trading day.
The Reserve Bank of India increased its currency market intervention, slowing the rate of decline. Following Russia’s invasion of Ukraine, the Indian currency, which has devalued by roughly 4% in 2022, came under pressure. Since the battle began in late February of this year, the foreign reserves have dropped by roughly $35 billion.