Indian rupee plunges to new low vs USD amid foreign fund outflow and US tariff concerns. FPIs continue selling, impacting equity and currency markets.
The Indian rupee fell to a new all-time low on Friday, closing at ₹88.27 against the US dollar. The decline of 15 paise was attributed to a consistent outflow of foreign funds and growing concerns over the possibility of new tariffs from the US.
Despite a weaker US dollar and falling crude oil prices, the local currency was unable to recover. The rupee opened the day at ₹88.11 and touched an intra-day low of ₹88.38 before its provisional close.
Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors LLP, noted that the initial sharp drop was fueled by market rumors. “The rupee fell to its record low on a rumour of the Trump administration imposing tariffs on the Indian IT sector, taking shares down and USD/INR pair up,” Bhansali stated. He added that the rupee later recovered slightly after the rumors were denied, though the dollar remained well-supported.
Bhansali also commented on the broader trend, stating that the rupee has struggled to gain ground even as the US dollar index falls and other Asian currencies rise. Foreign Portfolio Investors (FPIs) have been consistent sellers in both the currency and equity markets, adding to the pressure on the local unit.
In the global market, the dollar index dropped 0.31 percent to 98.03, while Brent crude futures were trading 0.25 percent lower at USD 66.82 per barrel.
On the domestic front, equity markets were mixed. The Sensex closed marginally down by 7.25 points, settling at 80,710.76, while the Nifty ended with a small gain of 6.70 points, closing at 24,741. Exchange data confirmed that foreign institutional investors offloaded equities worth ₹106.34 crore on Thursday.
Subscribe to our Newsletter
Disclaimer: Kindly avoid objectionable, derogatory, unlawful and lewd comments, while responding to reports. Such comments are punishable under cyber laws. Please keep away from personal attacks. The opinions expressed here are the personal opinions of readers and not that of Mathrubhumi.
