The rupee fell 84 paise to close at its lifetime low of 77.01 (provisional) against the US dollar on March 7 as intensifying geopolitical risks due to the Russia-Ukraine conflict pushed investors towards a safe haven Gone.
Forex traders said rising tensions between Russia and Ukraine kept crude prices higher and raised concerns about domestic inflation and a wider trade deficit.
Continued outflow of foreign funds and a weak trend in domestic equities also weighed on investor sentiment.
At the interbank forex market, the rupee opened at 76.85 against the US currency but lost ground and closed at a record low of 77.01 for the day, down 84 paise from the previous close.
The rupee on Friday closed down 23 paise at 76.17, its lowest level since December 15, 2021.
Sugandha Sachdeva, Vice President, Commodity & Currency, said, “The Indian rupee has slipped to a lifetime low against the US dollar as the Russia-Ukraine conflict fueled the risk appetite in the market, prompting safe-haven inflows into the US dollar. reduced.” Research, Religare Broking Limited
In addition, a parabolic rise in crude oil prices to several-year highs and rising commodity prices are raising inflation risks, which is a major headwind for the rupee-dollar exchange rate, Sachdeva said. .
According to Mr. Sachdeva, the overall trend for the Indian Rupee is skewed downwards and “A solid close below the 77 mark will pave the way for further downside towards the 77.50 mark in the near future while we test the hypothesis of the local currency.” 79 points from a medium-term outlook”. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.46% higher at 99.09.
Global oil benchmark Brent crude futures jumped 6.55% to $125.85 a barrel.
On the domestic equity market front, the 30-share Sensex ended 1,491.06 points or 2.74% lower at 52,842.75, while the broader NSE Nifty ended 382.20 points or 2.35% lower at 15,863.15.
Foreign institutional investors remained net sellers in the capital markets on Friday as they offloaded shares worth Rs 7,631.02 crore, according to stock exchange data.