Rupee hits 82-mark vs USD, ends at all-time low of 81.93

Mumbai, September 28

The rupee plunged below the 82-mark for the first time in day trade before settling down by 40 paise at 81.93 against the US dollar on Wednesday due to heavy forex outflows amid strengthening US treasury yields.

Moreover, a negative trend in domestic equities and a stronger dollar in overseas markets sapped investor appetite, forex traders said.

At the interbank foreign exchange, the rupee opened at 81.90 and later fell to 82.02 to a dollar in day trade due to risk-averse sentiment among investors.The rupee finally settled at 81.93, its all-time closing low.

The Indian rupee hit a fresh record low against the dollar on Wednesday weighed down by a rise in US treasury yields and the dollar, said Sriram Iyer, senior research analyst at Reliance Securities.

"However, the fall was less than at its Asian peers as the RBI intervened in the market today," Iyer said.

Offshore Chinese yuan weakened by 0.90%, while Singapore Dollar weakened by 0.48%, while the Korean Won weakened by 0.83% and were the worst performers among Asian peers.

In the overseas markets, the dollar index continued to remain elevated on Wednesday trade in Asia lifted by hawkish remarks from Federal Reserve officials.

Traders also await the RBI's monetary policy decision and details of the government's borrowing plan for the rest of the fiscal.

According to Gaurang Somaiya, forex & bullion analyst, Motilal Oswal Financial Services, the rupee continued to fall as the dollar rose sharply against its major crosses.

"Expectations of aggressive rate hikes by the US Fed helped the dollar extend gains. On the domestic front, focus will be on the RBI policy statement. Expectation is that the central bank could raise rates by 50bps and maintain a hawkish stance," Somaiya said.

The dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.40% to 114.55. Meanwhile, investors are eying the RBI monetary policy meeting decision on Friday.

Global oil benchmark Brent crude futures fell 1.33% to $85.12 per barrel. — PTI

Heavy forex outflows to blame

• A negative trend in domestic equities and a stronger dollar in overseas markets sapped investor appetite
• At the forex market, the rupee opened at 81.90 and later fell to 82.02 to a dollar in day trade before finally settling at 81.93, its all-time closing low

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