The US dollar remains unstoppable in July and is throwing its weight in the currency markets. The local currencies of BRICS nations are falling like a pack of cards this month against the USD. This comes even after the BRICS alliance kick-started the de-dollarization campaign to pull the US dollar down from the world’s reserve currency.
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BRICS member India’s local currency, the rupee has fallen to an all-time low of 83.74 on Friday’s closing bell. The US dollar is ravaging the rupee in the currency markets making it plummet in the charts. Recently, even the Chinese yuan dipped to a seven-month low while the Japanese yen is at its 1990s low.
BRICS: US Dollar Hammering Local Currencies in the Forex Markets
The US dollar spiked in value and trounced local currencies despite BRICS initiating the de-dollarization agenda on a global scale. The Indian rupee is another casualty of a stronger US dollar as it spirals down in the forex market. Demand for the US dollar is rising leaving no scope for local currencies to thrive.
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Analysts predict that the US dollar could make the rupee fall to another low of 83.84 in the coming weeks. BRICS nations’ currencies now remain under pressure while the demand for the US dollar rises. “Buying of dollars will continue. The rupee should depreciate to 83.84 a dollar level in the next two days,” said Anil Bhansali, executive director of Finrex Treasury Advisors to NDTV Profit.
Also Read: US Dollar Shows No Mercy To BRICS Nations’ Currencies
The Indian government raised the long-term capital gain tax from 10% to 12.5% during the recent national budget. It also raised the short-term capital gain tax from 15% to 20% subsequently, making way for the stock market and its currency to dip. The development indicates that the US dollar is king and remains the de facto stronger currency in the markets.