New Delhi: The Indian rupee slumped 50 paise to close at 86.26 against the US dollar on Tuesday, marking its steepest single-day drop in nearly three months. The currency has now declined for three consecutive sessions, making it the worst-performing Asian currency this month. Forex traders attributed the sharp fall to global trade war fears, foreign capital outflows, and a firm dollar overseas.
The rupee opened at 85.89 at the interbank foreign exchange today and swung between a high of 85.82 and a low of 86.29 against the greenback, before ending at 86.26, registering a loss from its previous closing level. The last time it saw such a steep loss in a single session was back on January 13, earlier this year, depreciating by 66 paise at the time.
Mounting global tension stems from the US administration’s latest threat to impose a 50% tariff on Chinese goods—retaliating against Beijing’s 34% import levies on American products. This tit-for-tat escalation has unnerved global markets and sent ripples through currency and commodity markets. The rupee opened at 85.89 and swung between 85.82 and 86.29 during intraday trade.
It settled at 86.26, logging its biggest drop since January 13. On Monday, it had already slipped 32 paise, following a 14 paise dip the session before. Market experts highlighted multiple pressures weighing on the rupee. “Strong demand for the dollar, FII outflows, and global uncertainty have pushed the rupee lower. A weak yuan has also added to the pressure,” said Dilip Parmar of HDFC Securities.
Meanwhile, investors are keeping a close eye on the RBI’s monetary policy announcement due Wednesday. RBI Governor Sanjay Malhotra and the MPC began deliberations on interest rates Monday. Despite some recovery in Brent crude (up 0.19% at $64.33), foreign institutional investors sold ₹4,994 crore worth of Indian equities. The domestic markets, however, staged a comeback with the Sensex and Nifty rebounding sharply after Monday’s crash.
