A steady depreciation in the rupee spells trouble for the rally on D-Street. Historically, most rallies in the equity market have occurred either when the rupee has appreciated or has been stable. In contrast, a decline in the value of the rupee against the dollar has been accompanied by market decline.
For example, the BSE Sensex is down around 2.6 percent since the beginning of November, against a similar 1.9 percent fall in the value of the rupee against the dollar in the period.
Today (16th Dec.2021), the equity market and the rupee ended in the red. The Indian currency closed at around 76.23 to a dollar, down around 0.47 percent, from Rs 75.87 on Tuesday. In comparison, the BSE Sensex was down 0.57 percent on Wednesday.
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