The rupee on Monday breached the crucial 72.50 mark against the dollar NSE -1.79 % on account of sustained buying of American currency by banks and importers.
The domestic unit plunged 85 paise to hit a new record low of 72.58 against the greenback. The local currency opened 36 paise down at 72.10. Rising crude oil prices and widened current account deficit put additional pressure on the local currency.
India’s current account deficit (CAD) widened to $15.8 billion in April-June in value terms this year as against $15 billion in the same quarter of 2017-18, mainly due to a higher trade deficit, according to RBI data released Friday.
The dollar inched higher against a basket of currencies on Monday following robust US August jobs data and amid fears of a potentially major escalation in the China-US trade conflict, Reuters reported.
The US President Donald Trump warned on Friday that he was ready to slap tariffs on virtually all Chinese imports into the United States, threatening duties on another $267 billion of goods in addition to the $200 billion already facing the risk of duties.
Meanwhile, domestic equity markets opened in red following subdued global cues. The BSE Sensex was trading 90 points, or 0.23 per cent, down at 38,300 at around 9.20 am (IST), while the NSE Nifty index was down 30.95 points, or 0.27 per cent, at 11,558 at around the same time.