RUPEE IN FREE FALL: CRASHES TO ALL-TIME HISTORIC LOW OF ₹68.80 AGAINST US DOLLAR
Current Account Deficit Soars to Dangerous 4.8% of GDP; Panic in Forex Markets as Foreign Capital Flees
On 28 August 2013, the Indian Rupee suffered an unprecedented intra-day collapse, tumbling to an all-time historic low of ₹68.80 (touching ₹68.85 intraday) against the US Dollar amid severe economic policy paralysis and massive macroeconomic imbalances.
The catastrophic plunge was triggered by a ballooning Current Account Deficit (CAD) of 4.8% of GDP, uncontrolled double-digit inflation, and stalled industrial reforms under UPA-2, prompting global credit rating agencies to warn that Indian sovereign bonds were on the verge of being downgraded to junk status.
The currency depreciation led to immediate fuel price hikes, crushing middle-class household budgets and exposing years of reckless fiscal mismanagement.
📌 Key Figures & Decision Makers
- ▸ P. Chidambaram (Finance Minister)
- ▸ Manmohan Singh (Prime Minister)
- ▸ D. Subbarao (RBI Governor)
"The Indian economy is in a delicate situation. The current account deficit is unsustainable and the exchange rate is volatile."
- • Reserve Bank of India Annual Report on Exchange Rate Trends (Reserve Bank of India, 2013)