News Business Rupee breaches 63 mark a dollar, ends at historic record low of Rs 63.13

Rupee breaches 63 mark a dollar, ends at historic record low of Rs 63.13

Mumbai: Continuing its free fall, the rupee today breached 63-mark a dollar to end at record low of 63.13, recording the decade's worst single-day fall of 148 paise, heightening fears that more capital control steps

rupee breaches 63 mark a dollar ends at historic record low of rs 63.13 rupee breaches 63 mark a dollar ends at historic record low of rs 63.13
Mumbai: Continuing its free fall, the rupee today breached 63-mark a dollar to end at record low of 63.13, recording the decade's worst single-day fall of 148 paise, heightening fears that more capital control steps could be in the offing.




Weighed down by heavy dollar demand and fall in stocks markets, the rupee fell to historic intra-day low of 63.30.

At the Interbank Foreign Exchange (Forex) market, the local currency opened sharply lower at 62.30 a dollar from its previous close of 61.65 but tried to recover later to a high of 62.21. Rupee again turned negative and finally ended at 63.13, logging a fall of a massive 148 paise or 2.40 per cent.

The previous biggest fall in decade was the 124 paise or 2.57 per cent plunge on September 22, 2011.

Forex dealers said that overseas investors sat on the sideline on caution ahead of the release of the minutes of The Federal Open Market Committee on August 21.

"Big demand from oil companies was there since morning. Apart from state-run banks, private and foreing banks were also bidding for dollars," said Srinivasa Raghavan, Executive Vice-President (Treasury), Dhanlaxmi Bank said.

Sentimentwise rupee falling to 63.30 will further be negative for market sentiment, said Ajay Marwaha, Executive Vice President and Head, Trading, in the Treasury, HDFC Bank.

In order to arrest the rupee slide, RBI last week had announced measures such as restricition on Indian firms investing abroad and on outward remittances by resident Indians, triggering talks of return of capital control regime.

Dealers said the FOMC minutes to be released on August 21 will likely give an indication on when the US Federal Reserve will start withdrawing it's monthly asset purchase programme.

Meanwhile, the Indian benchmark S&P BSE Sensex today fell by 291 points, or 1.56 per cent, after its overnight fall of 769 points. FIIs pulled out Rs 563.23 crore on last Friday as per provisional data with stock exchanges.

The dollar edged modestly higher against a basket of six major currencies.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said: "Expect spot Rupee to fall further, as now it is clear that the measures taken by the regulators to support Rupee will not have big impact...The trading range for the same is expected to be within 62.60 to 63.60."

Forex market participants said inspite of such a massive weakness in rupee, there was no major sign of central bank intervening in the currency markets.

"Rupee continued with its slide against the US dollar and breached the level of 63.00. The host of measures taken by the central bank in recent weeks has failed to revive sentiments.

"On the global front, US treasury yields are increasing, the US dollar is trading flat and locally, Indian bond yields are also increasing which indicates that currently the markets are quite directionless. This calls for a cautious approach," said Abhishek Goenka, Founder and CEO, India Forex Advisors.

Meanwhile, forward dollar premiums improved further on persistent payment pressure from banks and corporates.

The benchmark six-month forward dollar premium payable in January rose to 270-273 paise from 261-1/2-264-1/2 paise last Friday. Far-forward contracts maturing in July shot up to 521-525 paise from 504-508 paise.

RBI fixed the reference rate for the dollar at 62.3461 and for the euro at 83.0686.

The rupee remained weak and plummeted further against the pound sterling to 98.79 from previous close of 96.41. It also nose-dived against the euro to 84.27 from 82.26.

Rupee dropped against the Japanese yen to 64.44 per 100 yen from last close of 63.24.

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