Rupee Falls 4ps To Record Low Of 85.79/$

Mumbai: The rupee depreciated 4paise to close at a record low of 85.79 against the US dollar on Friday, as strong dollar demand from importers and a muted trend in domestic equities weighed on investors’ sentiments. Forex traders said the dollar gained against most currencies during 2024 and continued to remain on a strong footing this year.

The US dollar index breached the crucial 109-mark. The uptrend in the American currency was underpinned by expectations of fewer rate cuts and a view that the US economy will continue to outperform its peers globally. At the interbank foreign exchange, the rupee opened on a weak note and sank to an intra-day low of 85.80, and its high of 85.73 against the American currency.

The local unit settled for the day at a record low of 85.79, registering a fall of 4paise over its previous close. Reports of RBI selling US dollars supported the rupee at lower levels, traders said. On Thursday, the rupee depreciated 11paise to close at a record low of 85.75 against the dollar. On December 27, the local currency touched its lifetime intra-day low of 85.80 against the greenback.

Traders said the market will keep its focus on US President-elect Donald Trump’s policies, which could boost growth but might also increase price pressures and this would keep the US Fed on hold for longer on interest rate cuts. “We expect the rupee to trade with a negative bias on a strong US dollar and demand for Dollar from importers. FII outflows may also put pressure on the rupee.