India’s rupee slips to new record low against dollar

MUMBAI, August 20, 2013 (AFP) – India’s rupee hit a new all-time low against the dollar on Tuesday on continuing fears that recent measures to stabilise the currency and kickstart the flagging economy will not work.

Asia’s worst-performing currency this year slid to 64.11 rupees against the dollar, past its previous low of 63.22 the previous day.

After hitting its new low, it strengthened marginally to 63.75.

The rupee’s fall has spilt over to the stock and bond markets.

Indian shares — which have fallen seven percent in the past three trading days — slid as much as 1.83 percent in early trade Tuesday to a low of 17,970.98 points.

The yield on the 10-year benchmark bond hit 9.23 percent, the highest for over five years, reflecting eroding investor appetite for Indian debt as worries about the economy and potential default mounted.

India’s weak trading sentiment was mirrored across key Asian stock markets, with investors jittery before Wednesday’s US Federal Reserve meeting.

At the meeting the Fed may spell out more details about the rollback of its massive stimulus programme.

Most emerging market currencies have been hit by expectations the Fed will scale back its stimulus