Rupee breaches 72 mark for first time

The rupee’s woeful run continued for the seventh straight session on Thursday as worries on macroeconomic economic front and rout in emerging market currencies pulled the Indian unit below the historic 72-level for the first time ever.

The domestic currency plunged to 72.11 to the dollar at one point during the day’s trade before closing at 71.99, showing a steep 24 paise fall. The rupee has been under immense pressure due to a host of reasons, including soaring crude oil prices, sustained foreign fund outflows and wideningcurrentaccountdeficit.

Besides, escalation in global trade war tiff too weighed on sentiments. But primarily it was weakness in emerging market currencies overseas which boosted the dollar, resulting in a duress for the domestic currency.

“Markets are expecting some support from policy makers in terms of a separate window for OMCs and more relaxation on buyers credit and ECB guidelines. RBI intervened at various levels but was not very effective to contain the (rupee) movement,” Sajal Gupta, head forex and rates, Edelweiss Securities Ltd, said.

After a positive start in early trade, the beleaguered rupee crumbled to breach the 72-mark for the first time ever. It had opened higher by 13 paise at 71.62 per dollar. The currency has been caught in a free fall for last few sessions against the backdrop of surging global oil prices and consistent widening of trade deficit.

However, RBI’s intervention operations to contain volatility in the forex market remained elusive. Rupee continues to be worst performer among Asian currencies, having weakened by almost 13% since the beginning of 2018.