Rupee at record low: Domestic unit slips 32 paise to fresh all-time low of 89.85 vs. US dollar

The rupee depreciated 32 paise to an all-time low of 89.85 against the US dollar in early trade on Tuesday, weighed down by the broad strength of the American currency in overseas markets and persistent foreign fund outflows.

Forex traders said strong dollar demand from corporates, importers and foreign portfolio investors pressurised the rupee. Moreover, elevated crude oil prices further dented investor sentiments.

At the interbank foreign exchange, the rupee opened at 89.70 against the US dollar before dropping to a life-time low level of 89.85, down by 32 paise from its previous close.

On Monday, the rupee after sinking to 89.79 in intraday trade, settled at 89.53 against the US dollar.

"The RBI has been selling dollars in the market, but it has also bought dollars when Indian Rupee rose thus keeping the demand intact," said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

Bhansali further noted that, the fundamentals of the Indian economy like a high GDP growth of 8.2% have been overweighed by the dollar demand.

"The uncertainties surrounding the India-US trade deal have not helped the matters and have actually aggravated the dollar buying syndrome," Bhansali said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 99.41.

Brent crude, the global oil benchmark, was trading lower by 0.03% at $63.15 per barrel in futures trade.

The Indian equity market opened lower on Tuesday, tracking weak global cues and a decline in banking and financial stocks. Investors remain cautious ahead of the Reserve Bank of India’s December monetary policy meeting, slated to start on Wednesday.

At 9:50 AM, the S&P BSE SENSEX was down 357.83 points, or 0.42%, to the 85,284.07 level, while NSE’s NIFTY50 was at the 26,072.45 level, falling 103.30 points, or 0.39%.

Foreign Institutional Investors sold equities worth ₹1,171.31 crore on Monday, according to exchange data.