The rupee opened the day marginally lower at 65.82 to the dollar, but, soon slipped on dollar demand to 65.88. This was the lowest level that the rupee has seen since March 14 2017.
Economic fundamentals are taking a turn for the worst, which is now worrying the forex markets. This includes a sharper than expected deterioration in the current account deficit and sustained selling by Foreign portfolio Investors in the Indian markets.
Huge selling from Foreign Portfolio Investors (FPIs) has largely impacted the rupee as there is a resurgence of dollar demand. For the month of Sept, 2017, FPIs have net sold in the domestic markets to the tune of Rs 17,000 crores in the cash market.
The dollar has also been gaining momentum against a basket of currencies and the latest tax reform initiatives of the Trump administration has bolstered the demand for the dollar.