Rupee plunges 36 paise to close at a record low of ₹88.47 against US dollar

The rupee slumped 36 paise and closed for the day at an all-time low of ₹88.47 (provisional) against the US dollar, as ongoing tariff issue between India and the US weighed heavily on the domestic currency's vulnerability.

Forex traders said a recovery in the US dollar ahead of the inflation data and foreign fund outflows further dented investors' sentiments. Crude oil prices also gained over the past few sessions, putting further pressure on the rupee.

Traders noted that the rupee, which showed signs of minor recovery after US President Donald Trump gave positive signals about the India-US trade treaty, remains fragile due to dollar demand and global factors.

At the interbank foreign exchange, the domestic unit opened at ₹88.11 and fell to an all-time low of ₹88.47 against the US dollar in intraday trade. The domestic unit settled for the day at a record low of ₹88.47 (provisional), registering a sharp decline of 36 paise over its previous close.

On Wednesday, the rupee recovered slightly from its record low level and ended with a gain of 4 paise at ₹88.11 against the US dollar.

On September 5, the rupee touched the lowest-ever intraday level of ₹88.38, but pared all losses before ending at ₹88.09 against the US dollar.

The unit had recorded its all-time low closing level of ₹88.15 against the dollar on September 2.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.22% to ₹97.99.

Brent crude, the global oil benchmark, was trading 0.25% lower at USD 67.32 per barrel in futures trade.

On the domestic equity market front, Sensex climbed 123.58 points to settle at 81,548.73, while the Nifty advanced 32.40 points to 25,005.50.

Foreign Institutional Investors offloaded equities worth ₹115.69 crore on Wednesday, according to exchange data.

Meanwhile, India and the US are natural partners and teams from both sides are working to conclude negotiations on a bilateral trade deal, Prime Minister Narendra Modi said on Wednesday in response to US President Donald Trump's remarks that efforts are on to address "trade barriers" between the two countries.

The exchange between the two leaders on social media is largely seen as part of efforts by both New Delhi and Washington to reset ties that witnessed increasing stress in the last few weeks after Trump doubled tariffs on Indian goods.