The rupee touched a record low following a stronger dollar overseas and relentless FPI fund outflows. But it pulled back slightly at the close after the Reserve Bank of India sold dollars to stem the slide.
At the inter-bank forex markets, the domestic currency closed at 84.39 against the greenback after hitting a historic low of 84.4125 during intra-day trades.
The rupee closed at 84.39 to the dollar on Monday.
The American currency has been on the upswing since the victory of Donald Trump in the US presidential elections.
The dollar index, which gauges its strength against six other currencies, opened marginally lower at 105.49 against the previous close of 105.54 but hit a high of 105.92.
At the time of this report, it was trading with gains of 0.21 per cent at 105.78.
In the past one month, the index has risen nearly 2.41 per cent, putting Asian currencies under pressure.
Forex circles said state run banks continued to sell dollars on behalf of the RBI.
However, there was disappointing news from the stock markets with provisional data showing foreign portfolio investors (FPIs) selling stocks worth ₹3,024 crore.
Besides a strong dollar index, FPI sales have been behind the fall in the rupee.
This has been countered by the tight RBI leash on the markets through its regular interventions.
Jateen Trivedi of LKP Securities said the dollar index’s continued strength above 105 is expected to maintain pressure on the rupee.
“With resistance near 84.25-84.30 zone and support seen lower at 84.55, this week’s focus will be on the US CPI data release, which could influence the dollar’s trajectory,’’ he said.
Sensex tanks
The benchmark Sensex cracked nearly 821 points while the Nifty fell below the 23900 level with selling witnessed in banking, auto and power stocks because of the FPI pullout.
The 30-share Sensex fell 820.97 points or 1.03 per cent to end at 78675.18 with 25 of its constituents ending in the red.
During the day, it tanked 948.31 points or 1.19 per cent to 78547.84. The broader NSE Nifty took a knock of 257.85 points to close at 23883.45.
NTPC was the top loser in the Sensex pack.
“The markets remained under pressure, shedding over a per cent, extending the ongoing correction phase. Despite an initial uptick, Nifty witnessed sharp swings in the first half before selling pressure in heavyweight stocks shifted the momentum downward,” Ajit Mishra – SVP, research, Religare Broking Ltd, said.
Bitcoin party
Bitcoin rallied to the verge of $90,000 on Tuesday, riding a wave of euphoria since the election of Donald Trump as US president on expectations his administration will be crypto friendly, according to Reuters.
The world’s biggest cryptocurrency has become one of the most eye-catching movers in the week since the election and touched $89,982 — a gain of around 30 per cent since November 5. It was last down 1.4 per cent at $86,730.
