Record low: Rupee falls to 95.40 against US dollar

Rupee tumbled to a record low of 95.40 against US dollar in early trade on Tuesday, falling another 17 paise after already ending the previous session at its weakest-ever closing mark. Previously on Monday, the currency had declined sharply by 39 paise to close at 95.23 against the greenback. This comes as global uncertainty continues to be fueled by intensifying Middle East tensions, dragging down financial markets. Crude oil prices have remained elevated, intensifying concerns around inflation and slowing economic growth.

During Monday’s trade, rupee opened at 94.95 in the interbank foreign exchange market before sliding throughout the session to settle at 95.23. The cautious sentiment was reflected on Dalal Street as well as benchmark indices tumbled in red. BSE Sensex was trading at 77,090.12, down 179.28 points or 0.23% as of 9:40 am. NSE Nifty50 also dipped to 24,036.95, down 63.85 points or 0.26%.

Dilip Parmar, Senior Research Analyst, HDFC Securities told PTI, "The Indian rupee has hit a record low as the dollar recovered and crude oil prices held firm. This ongoing surge in oil prices, combined with foreign fund outflows, is putting a visible strain on India's trade balance and broader economy. Persistent dollar demand is expected to keep the pressure on the rupee in the short term, driving the USD/INR higher toward the 95.35 and 95.70 levels."

Foreign Institutional Investors remained net buyers in equities worth Rs 2,835.62 crore on Monday, based on exchange figures. In the commodity market, oil prices continued to soar. Crude oil prices were trading at nearly $113 per barrel on May 5 as fresh attacks in the Strait of Hormuz heightened fears over the stability of the US-Iran ceasefire.