Rupee plunges 14 paise to close at record low of 87.57 against US dollar
Mumbai (PTI): Rupee plunged 14 paise to close at an all-time low of 87.57 (provisional) against the US dollar on Thursday, as rising odds of a rate cut by the Reserve Bank of India in its monetary policy meeting on Friday pressurised the rupee.
Forex traders said the Indian rupee plunged to fresh record lows amid weak domestic markets and importer demand for dollars.
Moreover, risk aversion in global markets amid ongoing uncertainty over US trade tariffs may further weigh on the rupee.
At the interbank foreign exchange, the rupee opened at 87.54 and slipped further to an all-time intraday low of 87.60 against the greenback in initial deals.
The domestic unit finally settled for the day at 87.57 (provisional) against the greenback, registering a plunge of 14 paise from its previous close.
On Wednesday, the rupee plunged 36 paise to close at an all-time low of 87.43 against the US dollar.
The local unit has lost over 2 per cent so far this year. The sharp drop in the domestic unit comes after nearly a 3 per cent fall in the USD/INR pair in 2024, making it one of the worst-performing Asian currencies.
On January 1, 2024, the rupee was at 83.21 against the greenback.
The rupee has lost 193 paise so far this year. The domestic unit was quoted at 85.64 against the greenback on January 1, 2025.
Forex traders said the rupee is trading with a negative bias over the global trade war as market participants mulled the impact of tariffs being imposed by the United States and China.
"We expect the rupee to trade with negative bias amid weak domestic markets and importer demand for dollars. Risk aversion in global markets amid ongoing uncertainty over US trade tariffs may further pressurise the rupee. However, any intervention by the RBI may support the rupee at lower levels," said Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan.
Choudhary further noted that investors may remain cautious ahead of the RBI's monetary policy meeting decision and US non-farm payrolls data on Friday. "USD-INR spot price is expected to trade in a range of 87.30 to 87.90," Choudhary added.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.40 per cent higher at 108.00.
Brent crude, the global oil benchmark, rose 0.52 per cent to USD 75.00 per barrel in futures trade.
Additionally, weak PMI data signalled a slowdown in economic activity.
India's services sector activity expanded at the slowest pace in over two years in January amid softer increases in sales and output. The seasonally adjusted HSBC India Services PMI Business Activity Index fell from 59.3 in December to 56.5 in January -- its lowest level since November 2022.
The Monetary Policy Committee (MPC) of the Reserve bank of India (RBI) began its three-day meeting on Wednesday. The MPC will announce its policy decisions on February 7.
In the domestic equity market, the 30-share BSE Sensex was trading 213.12 points, or 0.27 per cent, lower at 78,058.16 points, while the Nifty was down 92.95 points, or 0.39 per cent, at 23,603.35 points.
Foreign institutional investors (FIIs) offloaded equities worth Rs 1,682.83 crore in the capital markets on a net basis on Wednesday, according to exchange data.
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Sujit Nair raises concerns over speculation of DMK-AIADMK understanding to block TVK
Chennai: Journalist and political commentator Sujit Nair has expressed concern over speculation that the Dravida Munnetra Kazhagam and the All India Anna Dravida Munnetra Kazhagam could explore a post-poll understanding to prevent Vijay-led Tamilaga Vettri Kazhagam from forming the government in Tamil Nadu.
In a social media post, Sujit Nair said the election verdict in Tamil Nadu reflected a clear public demand for political change and argued that the mandate should be respected irrespective of political preferences.
Referring to reports and political discussions surrounding a possible understanding between the DMK and AIADMK, he said he hoped such developments remained only speculative conversations and did not turn into reality.
Nair stated that if such an alliance were to take shape, it would raise serious questions about ideological politics in the country. He said TVK had emerged through a democratic electoral process and that the legitimacy to govern in a parliamentary democracy comes from the people’s verdict.
According to him, attempts to prevent an electoral winner from forming the government through unexpected political arrangements may be constitutionally valid, but many people could view them as politically opportunistic.
He further said that such a move could particularly affect the political image of the DMK, which has historically projected itself around ideology, social justice and opposition politics. Nair said that in ideological terms, the DMK appeared closer to TVK than to the AIADMK, and joining hands with its long-time political rival only to remain in power could weaken its broader political narrative.
He added that the same questions would apply to the AIADMK as well, as the party had spent decades positioning itself against the DMK and such an arrangement could create discomfort among its cadre and supporters.
Drawing a comparison with Maharashtra politics in 2019, Nair said he had expressed similar views when the Shiv Sena formed an alliance with the Indian National Congress and the Nationalist Congress Party after the Assembly elections.
He said post-poll alliances between long-standing political rivals often create a public perception that ideology and electoral mandates become secondary when political power equations come into play.
Nair also said such developments increase public cynicism towards politics and reinforce the belief among voters that ideology is often sidelined after elections.
He maintained that the Tamil Nadu verdict was emphatic and said respecting both the spirit and substance of the mandate was important for the credibility of democratic politics.
