Rupee drops by 8 paise to fresh record low of 75.20 vs dollar

The rupee gave up its day's gains to settle 8 paise lower at a fresh life-time low of 75.20 against the US dollar on Friday as forex market continued to grapple with economic uncertainties due to fast-spreading coronavirus pandemic.

At the interbank foreign exchange market, the domestic currency opened higher at 74.82 and gained more strength as the day progressed. It went on to hit a high of 74.72 before succumbing to weakening sentiments due to the virus scare. The Indian unit finally settled at 75.20, down 8 paise against the US dollar.

"The progression of fast-spreading coronavirus pandemic has created havoc ... This uncertainty and hysteria have grappled the forex market, depreciating all emerging market currencies and taking rupee to record low of 75.30 zone," Rahul Gupta, Head of Research - Currency, Emkay Global Financial Services, said. Globally, all central banks including RBI are trying to reduce the risk and loosen the tight liquidity however the increasing number of coronavirus cases in India will keep the rupee on an edge, he said.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was down 0.79 per cent to 101.95, helping the rupee trade higher. The domestic unit had closed at 75.12 against the US currency on Thursday.

On the equity front, The BSE Sensex ended 1,627.73 points or 5.75 per cent higher at 29,915.96. Similarly, the NSE Nifty zoomed 482 points, or 5.83 per cent, to close at 8,745.45. Investors continued to assess the impact of Covid-19 on the economy, impacting the trading sentiment on bourses.

According to the Health Ministry, the novel coronavirus cases in India rose over 200 on Friday. Foreign investors remained net sellers in Indian capital markets as they pulled out more than Rs 4,622.93 crore on Thursday, market data showed. Brent crude futures, the global oil benchmark, rose 2.46 per cent to USD 29.17 per barrel. The most-traded 10-year government bond yield was at 6.25.