Rupee in red: Currency falls 8 paisa in early trade; reaches 90.98 against US dollar

Rupee continued to fall on Tuesday, slipping 8 paisa in early trade, to reach 90.98 against the US dollar.

The currency had already taken a heavy hit earlier on Monday, breaching the crucial 91.01 mark before closing 12 paise lower at 90.90 against the dollar. The dip came due to strong dollar demand from metal importers and continuous foreign fund outflows.

The currency was dragged down by strong dollar demand from metal importers and continued foreign fund outflows weighed on investor sentiment. Forex traders said that rising geopolitical uncertainty, along with renewed US expansionary signals, has increased risk aversion and kept emerging market currencies under pressure. They also pointed to a sluggish domestic stock market, further dampened by the ongoing exit of foreign capital.

Rupee has remained close to historic lows in recent weeks. Last year on December 16, it touched an all-time intra-day low of 91.14 and recorded its weakest closing level of 90.93. Last Friday, the rupee had plunged 44 paise to 90.78 after losing 17 paise over the preceding two sessions.

Global cues also remained mixed as the dollar weakened and crude prices edged lower. The dollar index, which tracks the US currency against a basket of six major peers, slipped 0.29% to 99.10, reflecting softness in the greenback. Meanwhile, Brent crude futures eased 0.37%to $63.88 a barrel.