Rupee falls 14 paise to close at all-time low of 85.08 against U.S. dollar

Rupee falls 14 paise to close at all-time low of 85.08 against U.S. dollar

Rupee falls 14 paise to close at all-time low of 85.08 against U.S. dollar

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| Photo Credit: Reuters

The rupee dropped 14 paise and breached the crucial 85 level to close at an all-time low of 85.08 (provisional) against the U.S. dollar on Thursday, as a hawkish stance from the U.S. Federal Reserve sparked a broad dollar rally.

Forex traders said the Indian rupee breached the 85-mark for the first time and fell to a new record low on Thursday, as the U.S. Federal Reserve adjusted its projections for 2025, signalling a more cautious monetary policy stance, pressuring emerging market currencies, including the Indian rupee.

The U.S. Federal Reserve cut interest rates by 25-bps to 4.5%, in line with estimates. However, it signalled only two rate cuts in 2025 from its previous expectations of four rate cuts.

At the interbank foreign exchange, the rupee opened on a weak note and breached the crucial 85.00 level against the greenback.

It fell further to an all-time low of 85.08 against the American currency, registering a fall of 14 paise over its previous close, as dollar demand from importers, foreign fund outflows and a muted trend in domestic equities further dented investor sentiments.

On Wednesday, the rupee dropped 3 paise to close at an all-time low of 84.94 against the U.S. dollar.

“We expect the rupee to trade with a negative bias on global equities following a hawkish Fed and a strong dollar. Concerns over slowdown in the economy may further weigh on the rupee,” said Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan.

Mr. Choudhary further noted that any intervention by the Reserve Bank of India (RBI) may also support the rupee.

“Traders may take cues from final GDP, weekly unemployment claims, and existing home sales data from the US. USD-INR spot price is expected to trade in a range of 84.9 to 85.25,” he said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.13% at 107.88.

Brent crude, the global oil benchmark, fell 0.05% to $73.35 per barrel in futures trade.

In the domestic equity market, the 30-share BSE Sensex closed 964.15 points, or 1.20%, down at 79,218.05 points, while Nifty settled down 247.15 points, or 1.02% to 23,951.70 points.

Foreign Institutional Investors (FIIs) offloaded ₹1,316.81 crore in the capital markets on net basis on Wednesday, according to exchange data.

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