₹ slumps 30p to end at new low of 74.06

The rupee continued its dismal slide, losing 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar on Monday amid strengthening of the greenback and steady capital outflows.

The rupee had opened lower by 14 paisa against Friday’s close of 73.76 in early trade as the US dollar strength against major global currencies weighed on the rupee sentiment.

During the day, the domestic currency recovered to a high of 73.76, but failed to sustain the momentum and plunged to 74.10.

It finally closed at 74.06, its fifth straight session of decline. On Friday, it had lost 18 paise to end at 73.76.

“Indian rupee is expected to trade with a negative bias amid strong Dollar and rising crude oil prices. Demand for dollar is going up on solid economic data from the US and, as US Federal Reserve raised interest rates by 25 bps and signalled further monetary tightening,” said Saif Mukadam, Research Analyst, Sharekhan by BNP Paribas.

Mukadam further said that traders will remain cautious ahead of the macroeconomic data, US treasury currency report and IMF meeting.

“Correction in Rupee may be seen if RBI permits for special dollar swap window with some staterun fuel retailers or come up with other options to check Rupee fall,” Mukadam said, adding that the expected trading range in near term is Rs 72.50 - 74.60.

The dollar demand strengthened after China’s central bank eased its domestic policy to support the economy, amid a deepening trade war with the US that has increased growth pressure in the world’s second largest economy.

China’s central bank said on Sunday said that it was cutting the reserve requirement rations (RRRs) by 1% from October 15, which will inject a net $109.2 billion into the banking system.

MUMBAI: