Kamal Ghorui
The rupee plunged by 82 paise, or nearly 1 per cent, to settle at an all-time low of 93.71 (provisional) against the US dollar on Friday, weighed down by persistent foreign fund outflows and a sharp rise in global crude oil prices amid mounting geopolitical tensions, PTI reported.Forex traders said the domestic currency remained under intense pressure as elevated energy prices and a shift towards risk aversion dented investor sentiment. Heightened geopolitical uncertainty has also fuelled concerns that higher oil costs could widen India’s trade deficit and push up inflation.At the interbank foreign exchange market, the local unit opened at 92.92 against the greenback and soon breached the 93-mark for the first time. It continued to weaken during the session before settling at 93.71 (provisional), down 82 paise from the previous close.On Wednesday, the rupee had slumped 49 paise to end at its earlier record low of 92.89 against the US dollar. Forex markets remained closed on Thursday on account of Gudhi Padwa.“The rupee hit fresh all-time lows on Friday amid geopolitical tensions in West Asia and FII outflows. Rising global crude oil prices, too, have pressured the rupee,” said Anuj Choudhary, Research Analyst, Commodities Research, Mirae Asset Sharekhan.He noted that major central banks, including the US Federal Reserve, European Central Bank, Bank of England and Bank of Japan, have left interest rates unchanged in their recent monetary policy meetings, citing inflation concerns while reiterating their readiness to adjust policy as required.“We expect the rupee to trade with a negative bias as escalating geopolitical tensions and rising crude oil prices may continue to pressure the rupee,” Choudhary said, adding that the USD-INR spot rate is likely to move in the range of Rs 93.20–93.80.Meanwhile, the dollar index, which measures the greenback’s strength against a basket of six currencies, was trading 0.35 per cent higher at 99.58. Brent crude, the global oil benchmark, rose 1.84 per cent to USD 110.7 per barrel in futures trade.On the domestic equity market front, benchmark indices recovered from the previous session’s losses. The BSE Sensex was trading 325.72 points, or 0.44 per cent, higher at 74,532.96, while the NSE Nifty gained 112.35 points, or 0.49 per cent, to 23,114.50.According to exchange data, foreign institutional investors (FIIs) sold equities worth Rs 7,558.19 crore on a net basis on Thursday, adding to pressure on the local currency.
