The Indian rupee (INR) suffered sharp losses against the US dollar (USD) today amid turmoil in both global equity and currency markets. The rupee fell to 70.60 against the US dollar at day’s low, as compared to its previous close of 69.60 a dollar – its biggest one-day fall since December 2018. Throwing the global currency market into turmoil, China today let its currency Yuan tumble beyond the key 7-per-dollar level for the first time in more than a decade.
After opening at 70.06 a USD, the rupee weakened to 70.60 at day’s low. In recent trade, the rupee was trading at 70.40 a dollar. Indian Stock markets fell sharply today, tracking a selloff in other Asian markets. Gold prices hit a six-year high in global markets while futures surged to record highs in India.
Outflows from Indian markets also hurt the rupee. Domestic investor sentiment inequities, which seemed to be upbeat on Friday after reports said the government was looking into foreign portfolio investors’ tax concerns, returned to being bearish due to the escalating trade war. The Sensex fell over 600 points today. Foreign portfolio investors (FPIs) pulled out a net Rs 2,632.58 crore from equities and Rs 248.52 crore from the debt segment in the first two trading sessions of this month.