MARKET NEWS
Indian rupee sinks to record low versus offshore yuan in likely boost to competitiveness
MUMBAI, Aug 29 (Reuters) - The Indian rupee weakened to a new all-time low against the offshore Chinese yuan on Friday, a move that could boost competitiveness for a segment of exporters in the South Asian nation facing hefty U.S. tariffs.
The rupee dropped to 12.3862 against the offshore yuan on Friday, extending its weekly decline to 1.2% and the monthly drop to 1.6%.
Over the past four months, the Indian currency has tumbled nearly 6% against the yuan.
The rupee's fall versus the yuan reflects the contrasting recent news flow about U.S. tariffs for India and China, according to Gaura Sen Gupta, economist at IDFC FIRST Bank.
Washington imposed an additional 25% tariff on Indian goods this week, doubling the total duties faced by the South Asian nation to 50%.
Meanwhile Chinese goods face a lower 30% tariff from the U.S. with a pause on higher triple-digit duties remaining in place.
The yuan-rupee forex rate matters for India’s trade performance, considering that the two economies compete directly in key U.S-bound sectors such as textiles, engineering goods and chemicals.
