Mumbai, March 23 The rupee continued its downward trend on Monday, losing 41 paise to fall to a record low of 93.94 against the US dollar, as the ongoing war in West Asia kept global crude oil prices high, and the US dollar remained strong.
Sustained outflows of foreign funds and a crash in the domestic equity markets in the morning session further weakened the local currency, forex traders said.
At the interbank foreign exchange market, the local currency opened at 93.84 against the US dollar before falling further to its record low of 93.94, down 41 paise from its previous close.
The rupee crossed 93 against the greenback for the first time on Friday and fell by 64 paise, eventually settling at an all-time low of 93.53.
"The fall in the rupee was very significant, considering that India is now paying USD 50 more on crude it imports from the Gulf per barrel. The Reserve Bank of India (RBI) was present at various levels but it only allowed the rupee to fall as demand for dollars was very high," said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP.
"The expectation is that the RBI may intervene to control further depreciation, but the demand from oil and FPIs will continue to remain high," Bhansali said.
Meanwhile, the dollar index, which gauges the strength of the US dollar against a basket of six currencies, was trading 0.02 per cent higher at 99.66.
Brent crude, the global oil benchmark, was trading 0.60 per cent lower at USD 112.90 per barrel in futures trade.
On the domestic equity market front, the Sensex fell by 1,306.27 points, or 1.75 per cent, to 73,226.69, while Nifty was down 418.25 points, or 1.81 per cent, to 22,696.25.
Foreign institutional investors sold equities worth Rs 5,518.39 crore on a net basis on Friday, according to exchange data.
Meanwhile, India's forex reserves dropped USD 7.052 billion to USD 709.759 billion during the week ended March 13, the RBI said on Friday.
