The rupee falls by 12 paise to hit an all-time low of 88.80 against the US dollar again

The rupee devalued by 12 paise to hit an all-time low of 88.80 (provisional) against the US dollar again on Tuesday, pressured by negative domestic equities and overnight gains in the US currency.

Forex traders said the outflow of foreign funds in a risk-avoidance situation has further dented investor sentiment globally.

However, a decline in crude oil prices and reports of RBI interventions supported local unity and limited the decline.

At the interbank forex market, the rupee opened at 88.73 against the dollar and fell to an intraday low of 88.81 and a high of 88.73. It finally closed the day at 88.80 against the dollar, registering a decline of 12 paise from the previous close of 88.68.

By September 30, the rupee had fallen to an all-time low of 88.80 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, traded 0.10 percent higher at 99.36. Brent crude, the global oil benchmark, was trading 2.15 percent lower at $61.99 a barrel in futures trading. According to some experts, the only issue hurting investor sentiment is US-India trade tariffs.

A team of senior officials from India will visit the US this week for trade talks, and negotiations on the proposed bilateral trade deal are going well, a top official said on Monday.

In February this year, the leaders of the two countries instructed officials to negotiate a proposed bilateral trade agreement (BTA).

The first tranche of the pact was planned to be completed in the autumn (October-November) of 2025.

Five rounds of negotiations have been completed so far.

“Weak tone in global crude oil prices and FII inflows could favor the rupee. The US government shutdown and rising chances of a rate cut by the US Federal Reserve could further weigh on the US dollar. The USD/INR spot price is expected to trade within a range of 88.50 to 89,” said Anuj Choudhary, Research Analyst, currency and commodities, Mirae Asset ShareKhan.

In domestic macroeconomic data, India’s CPI inflation cooled to an eight-year low of 1.54 percent in September from 2.07 percent in August. It fell below the RBI inflation target of 2 percent.

WPI inflation also cooled to 0.13 percent in September from 0.52 percent in August.

In the domestic equity market, Sensex fell 297.07 points to 82,029.98, while the Nifty fell 81.85 points to 25,145.50.

Foreign institutional investors sold shares worth Rs 240.10 crore on Monday, according to stock exchange data.