The Indian rupee tumbled by 52 paise to finish at 87.43 (provisional) against the US dollar on Wednesday under pressure with the uncertainty arising again over the proposed India-US trade deal. This was after US President Donald Trump had indicated that his country was likely to set tariff levels of approximately 20 25 percent before the August 1 deadline, and this sent sentiments soaring in the currency market.
Forex dealers blamed the month-end imports on dollar demand by importers and consistent outflows of foreign funds as the reason behind the weakness of the rupee. The continued risk-off being portrayed by investors on the global trade tension was also a contributing factor to pressure on the local currency.
The rupee opened at 87.10 against the greenback at the interbank foreign exchange market and nosedived to an intraday low of 87.05 during trading hours. It closed at 87.43, an enormous decline from its earlier close of 86.91 on Tuesday, which had already dipped to a four-month low by closing 21 paise lower.
However, benchmark indices performed humbly in domestic equity markets. The 30-share BSE Sensex rose 143.91 points, or 0.18 per cent, at 81,481.86, and the NSE Nifty was up 33.95 points, or 0.14 per cent, to 24,855.05.
In the meantime, foreign institutional investors (FIIs) sold for the third consecutive day, selling 4636.60 crore rupees more worth of equity on Tuesday as per the exchange data, which only worsened the market mood and the prospects of the rupee even more.
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