The Indian rupee started the week on a slightly weaker note, mirroring a broader decline in Asian currencies and reflecting ongoing anxieties surrounding the country's general election, Reuters reported on Monday. The rupee traded at 83.52 per dollar at 11:06 IST on Monday, down marginally from 83.50 in the previous session. This weakness aligns with the ongoing slump in Indian stock markets. The Nifty 50 index fell nearly 1 per cent to its lowest level in three weeks, extending last week's losses. A key factor weighing on the rupee and equity markets is the uncertainty surrounding the outcome of the ongoing general election. Lower-than-expected voter turnout has raised concerns that Prime Minister Narendra Modi's party might not secure the decisive victory predicted by opinion polls. This has dampened investor sentiment towards Indian assets. Foreign investors have further exacerbated the situation by withdrawing over $2 billion from Indian equities last week. Despite the foreign outflows, the rupee's volatility remained relatively low. This suggests possible intervention by the Reserve Bank of India (RBI) to stabilise the currency. Market analysts believe the RBI is actively managing the exchange rate to prevent a sharper depreciation. The rupee's weakness is also part of a broader trend in Asia. Other major regional currencies opened the week down between 0.1 and 0.6 per cent. This cautious mood stems from upcoming US economic data that could influence future Federal Reserve policy decisions. Investors are keenly awaiting Wednesday's release of US consumer inflation data, particularly the core measure, which is expected to show a 0.3 per cent increase month-on-month.
