Rupee plunges 61 paise to hit over 2-month low

The rupee on Monday tanked by 61 paise to close at over two-month low of 70.52 against the US dollar on rising crude oil prices and weak industrial output growth data. Subdued domestic equity market and foreign fund outflows further dented forex market sentiment.

Extending its fall for a ninth straight session, BSE Sensex tumbled over 372 points to 37,090, while NSE Nifty dived 131 points to 11,148.20.

Industrial production contracted by 0.1 per cent in March, the lowest in 21 months, mainly due to manufacturing sector slow down, official data showed on Friday.


Factory output, as measured in terms of the Index of Industrial Production (IIP), had grown by 5.3 per cent in March 2018. IIP’s previous low was recorded in June 2017, when output shrank by 0.3 per cent.
Foreign portfolio investors offloaded more than Rs 3,000 crore from the domestic capital markets (equity and debt) in May so far.

According to ICICIdirect.com, oil above the $70 level is likely to keep the sharp rupee appreciation in check. The level of 68.50 continues to remain crucial support for the currency. A move in the Chinese Yuan would also be a key trigger for emerging market currencies including the rupee in the backdrop of renewed trade tiff escalation between the US and China.

The Chinese yuan is hovering at its four-month low now. Brent crude oil is now at around $71.73 per barrel, up over 1 per cent against the previous close.