Rupee dives 98 paise to hit all-time low of 89.66 against US dollar
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Mumbai (PTI): The rupee plunged 98 paise to close at its lifetime low of 89.66 against the US dollar on Friday, due to a huge demand for the greenback in the domestic forex market amid widespread selling pressure in local and global equities and trade-related uncertainties.
Concerns over a possible bubble building around artificial-intelligence technology stocks also spooked investor sentiments, forex traders said.
Besides, renewed foreign fund outflows added to the gloom, they added.
At the interbank foreign exchange market, the rupee opened almost flat at 88.67 and before turning extremely volatile in the afternoon session. During the day trade, it moved between a high of 88.59 and a low of 89.66.
In the steepest fall in over three years, the domestic currency nosedived 98 paise to finally settle at 89.66 against the American currency. The previous biggest one-day fall was recorded at 99 paise against the dollar on February 24, 2022.
On Thursday, the rupee depreciated 20 paise to close at 88.68 against the US dollar.
"The Indian rupee witnessed a dramatic move on Friday, breaking its all-time high...in a sudden spike that caught the market completely off guard. Unlike earlier sessions, where news flow guided the price action, this move was largely demand-driven, triggered by an unexpected wave of dollar buying at a time when supply stayed quiet," CR Forex Advisors said in a note.
"What made the move even more striking was that all other major indicators remained broadly stable -- the dollar index, crude oil prices, EM currencies, and even gold hardly moved. This calm backdrop further reinforced that Friday’s jump in USD/INR was not driven by global cues, but purely by domestic dollar demand overwhelming available supply."
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was 0.09 per cent up at 100.17.
Brent crude, the global oil benchmark, was trading 2.18 per cent lower at USD 62.00 per barrel in futures trade.
On the domestic equity market front, the Sensex declined 400.76 points, or 0.47 per cent, to settle at 85,231.92, while the Nifty tanked 124.00 points, or 0.47 per cent, to 26,068.15.
Foreign institutional investors sold equities worth Rs 1,766.05 crore on a net basis on Thursday, according to exchange data.
The global risk-off sentiment has spilt into currency markets after a sharp overnight sell-off in cryptocurrencies and AI-linked technology stocks, Anindya Banerjee, Head of Research Currency, Commodity and Interest Rate Derivatives, Kotak Securities, said.
"The sudden unwinding of risk trades is weighing on emerging-market currencies, including the Indian rupee. Adding to the pressure is the lingering uncertainty around the proposed India-US trade deal, which markets had hoped would offer clarity on the bilateral economic outlook. With no firm timelines emerging, sentiment remains fragile," Banerjee said.
Reserve Bank Governor Sanjay Malhotra on Thursday said the central bank does not target any level for the rupee, and the recent depreciation of the domestic currency against the US dollar is primarily due to trade uncertainties following the imposition of tariffs by the US administration.
"We do not target any level. Why is the rupee depreciating? (It) is because of the demand. It is for the markets to decide... It is a financial instrument, and there is a demand for dollars, and if the demand for dollars goes up, the rupee depreciates; and if the demand for the rupee goes up, the dollar comes down, then it appreciates," Malhotra said at an event in the national capital.
The governor also exuded confidence that India will secure a favourable trade deal with the US, which will help ease the pressure on the current account.
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Fresh case registered against activist Snehamayi Krishna
Bengaluru PTI): A fresh FIR has been registered against social activist Snehamayi Krishna for making defamatory statements against a woman.
Basaveshwara Nagar Police Station registered a First Information Report against Krishna on Saturday.
According to the FIR, complainant Pavithra B N (37) alleged that a letter dated December 5 was delivered to her residence, in which Snehamayi Krishna made defamatory allegations regarding the death of her husband and against her advocate, Raghu.
The letter also indicated that a complaint had been submitted to the Mahalakshmipuram Police Station seeking reinvestigation into her husband’s death.
The complainant further alleged that a threatening note was enclosed with the letter, pressuring her to withdraw cases filed against a man named Mylaraappa.
She stated that the mobile number of the person exerting pressure was mentioned in the letter.
Pavithra claimed that the alleged actions had caused severe distress to her family, disrupted her children’s education, created unrest at home and deprived them of peace.
She also accused the persons named in the complaint of using abusive language and issuing life threats.
Police initially registered a non-cognisable report.
After Pavithra obtained permission from the 24th ACMM Court to initiate criminal proceedings, an FIR was formally registered against Snehamayi Krishna and Mylaraappa as per the court’s direction.
Krishna has previously been in the news for lodging complaints and making allegations against Chief Minister Siddaramaiah, his wife Parvathi B M, and others for obtaining Mysuru Urban Development Authority (MUDA) alternative sites (plots) against the rules.
The Lokayukta police which investigated the matter filed a closure report, which the special court of public representatives admitted.
On Thursday, he also levelled accusations against Karnataka Chief Secretary Shalini Rajneesh along with a Karnataka Administrative Services (KAS) officer D B Natesh, the former MUDA Commissioner.
Shalini Rajneesh's office rejected the charges categorically and termed his accusations "defamatory".
On Saturday he apologised for making allegations against the Chief Secretary.
