Rupee tanks 104 paise to close at 73.47 against US dollar

The rupee dived 104 paise to settle at 73.47 (provisional) against the US dollar on Friday, following a heavy selloff in domestic equities and strong American currency in the overseas market.

At the interbank forex market, the local unit opened at 72.43 against the greenback, then lost further ground to touch an intra-day low of 73.51.

It finally ended at 73.47 against the American currency, registering a massive fall of 104 paise over its previous close.

On Thursday, the rupee had settled at 72.43 against the American currency.

The dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.43 percent to 90.52.

''US bond yields have surged on worries about inflationary pressures due to unprecedented liquidity infusion in the system and a series of economic data, which is indicating that the economy is on the path to normalcy. This has in-turn led to a rebound in the dollar index and prompted a selloff in risk assets.

''We think that the rupee could see some more depreciation till the 73.50 mark, as the narrowing interest rate differential between India and US could prompt some outflows from the Indian bond and equity market,'' Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking, said.

However, it is too early to term this as a weakening bias for the domestic currency, and unless it sustains levels below 73.50 comfortably, the scope for appreciation remains, she added.

Meanwhile, Brent crude futures, the global oil benchmark, fell 0.99 percent to USD 66.22 per barrel.

On the domestic equity market front, the BSE Sensex ended 1939.32 points or 3.80 percent lower at 49,099.99, while the broader NSE Nifty slumped 568.20 points or 3.76 percent to 14,529.15.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 188.08 crore on Thursday, according to exchange data.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)