Indian Rupee Hits Record Low Against US Dollar, Touched 79.38

On Monday, the rupee hit a record low of 79.38 against the US dollar, as dollar strength and negative trends in domestic equities put pressure on the domestic currency. However, falling oil prices kept the losses in check.

By 0436 GMT, the partially convertible rupee was trading at 79.38/39 per dollar, down from 79.25 at the close on Friday. The unit had previously reached a life-low of 79.3750 last week.

Global oil prices tumbled on Monday as investors worried about tight supply and the possibility of a recession. Brent futures were 1% lower at Rs 106 per barrel. WTI futures fell as much as 1.2 percent to $103.5 a barrel.

Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services Ltd, said, "Rupee continued to remain under pressure as the dollar rose sharply against its major crosses after better-than-expected NFP number from the US. Weakness continued to prevail for the rupee despite measures introduced by RBI last week. Inflation number on the domestic front and the US will be released this week and a higher number could cement expectation of further rate hike by the central bank. We expect the USDINR (spot) to trade with a positive bias and quote in the range of 79.05 and 79.80 in the short term."

The dollar Index, which measures the strength of the US currency against six peers, increased by half a percent to 107.2.

Domestic stock markets were both down about 0.5 percent. The BSE Sensex fell 300 points and closed at 54,180, while the Nifty fell 63 points and closed at 16,157.