An Indian two thousand rupee banknote. (Photographer: Dhiraj Singh/Bloomberg)

Rupee Slips Further, Settles Below 71-Level Against Dollar

The Indian rupee today plunged another 9 paise to close near one-month low of 71.02 against the U.S. dollar amid strengthening greenback and surging crude oil prices.

At the Interbank Foreign Exchange, the rupee opened weaker at Rs 70.75 then lost ground and fell to a low of 71.15 against the American currency.

The domestic unit, however, gained some strength and settled at 71.02 a dollar, down 9 paise over its previous close.

This was the third straight session of loss for the rupee. The domestic currency Monday plunged by 44 paise to close at nearly one-month low of 70.93 against the U.S. dollar. The Indian unit has lost 64 paise in these three sessions.

Forex traders attributed the rupee plunge to rising crude prices. However, heavy buying in domestic equities and fresh foreign fund inflows restricted the fall in the local unit to some extent.

Stronger dollar against its key rival currencies impacted the rupee trading pattern, they said.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was higher by 0.22 percent to 95.81 in late afternoon trade.

Brent crude, the global benchmark, was trading at $59.81 per barrel, higher by 1.39 percent.

Foreign funds bought shares worth Rs 159.60 crore from the capital markets on a net basis and domestic institutional investors purchased shares worth Rs 417.44 crore Tuesday, provisional data showed.

The Financial Benchmark India Private Ltd. set the reference rate for the rupee/dollar at 71.0298 and for rupee/euro at 81.5048. The reference rate for rupee/British pound was fixed at 91.6242 and for rupee/100 Japanese yen at 65.37.