Extending its free-fall, Indian rupee touched a fresh low of Rs 74.26 against the US dollar in intra-currency trades on Tuesday, an increase of 18 paise from its previous close of 74.07, on the back of elevated prices of crude oil, amid weak domestic stock markets and foreign capital outflows. The rupee has fallen 2% in October and 16% in 2018.
After opening at 73.85 per USD on Tuesday, the rupee made a cautious recovery of 18 paise in the early morning trade, on fresh selling of the American currency by banks and exporters. However, it, later on, turned weak and declined to trade at a fresh lifetime low of 74.27 against the US dollar. It touched an intra-day high of 73.85 per US dollar on Tuesday, Bloomberg data showed.
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On Monday, the domestic currency declined by 30 paise to close at a record low of 74.07 against the US dollar.
Meanwhile, Brent crude breached the $84 a barrel-mark again and the US dollar strengthened against its global peers.
Stock exchanges – Sensex and Nifty – traded rangebound in the afternoon session on Tuesday, with Tata Motors shares plunging nearly 20% to seven-year low levels. The BSE Sensex fell 189 points to an intra-day low of 34,285.06 points, while the NSE Nifty slipped to a low of 10,279.35 points intra-day.
On the other side, Asian shares hit 17-month lows on Tuesday as China allowed its currency to slip past a psychological bulwark amid sharp losses in domestic share markets, a shift that pressured other emerging currencies to depreciate to stay competitive, said a Reuters report.
Also, the International Monetary Fund has also predicted a growth rate of 7.3% for India in the current year of 2018 and that of 7.4% in 2019. In 2017, India had recorded a growth rate of 6.7%.