In the Forex market, the rupee today plunged by 61 paise to settle at 86 rupees and 58 paise against the US dollar due to the strengthening of the US currency. The rupee remained under pressure also due to multiple factors including losses in the domestic stocks, stronger than expected US job growth data, surge in crude oil prices and higher US treasury yields.
The dollar index, which indicates the US dollar’s strength against a basket of six other leading currencies, is trading at 110.08 in intra-day trade.
Rupee depreciation is unlikely to bring the markets down, though it makes returns of foreign investors from Indian equities less attractive.

The rupee declined by 3.1 per cent since September, and Indian equity benchmarks Nifty and Sensex fell by 8.5 and 7.3 per cent, respectively, during the same period. However, the markets need not tank every time the rupee depreciates sustainably over months.
From January 2022 to October 2022, the rupee declined by 10.2 per cent, but Nifty and Sensex rose by 3.8 and 4.3 per cent, respectively. Similarly, from April 2018 to October 2018, the rupee declined by 12 per cent, but the Nifty and Sensex gained 2.7 and 4.5 per cent, respectively. A random sample taken over five instances when the rupee declined over months showed that a rupee depreciation need not necessarily lead to a market fall. The benchmark indices gained on two out of these five occasions