The rupee closed at a new all-time low of 90.32 against the US dollar on Thursday, sinking 38 paise, as uncertainty around the India-US trade deal and continued foreign fund outflows pressured the currency, PTI reported.
The local unit opened at 89.95, weakened further through the session and hit a record intra-day low of 90.48, before settling at 90.32. It had ended Wednesday at 89.94.
Forex traders told PTI the fall followed comments attributed to Chief Economic Adviser V Anantha Nageswaran indicating the proposed bilateral trade agreement may only be concluded by March. They added that delays in the deal, coupled with risk-averse markets, have kept the rupee under pressure.
“Indian rupee hit a fresh all-time low amid uncertainty over the India-US trade deal. However, positive domestic markets and a weak US Dollar cushioned the downside,” said Anuj Choudhary, Research Analyst, MiraeAsset ShareKhan. Choudhary said the rupee may trade with a negative bias, though any Reserve Bank intervention could offer support.
US Trade Representative Jamieson Greer told a Senate panel this week that the US had received the “best” offers yet from India on the proposed trade agreement, even as disagreements continue over row crops like corn, soybeans, wheat and cotton.
Analysts said strong dollar demand from importers added to the pressure. “The rupee plunged to a record low… largely fuelled by aggressive dollar purchases from the importers,” said Dilip Parmar, Research Analyst, HDFC Securities, adding that higher global precious metal prices also pushed metal importers to buy dollars.
The dollar index was 0.18 per cent lower at 98.61, while Brent crude traded 1.25 per cent down at USD 61.43 a barrel.
On the domestic front, the Sensex rose 426.86 points to 84,818.13, and the Nifty gained 140.55 points to 25,898.55. Foreign institutional investors sold equities worth Rs 2,020.94 crore, according to exchange data
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