Mumbai, 3 Dec

The rupee plunged to a record low of 90.25 against the US dollar in intra-day trade on Wednesday, slipping 29 paise from its previous close, amid sustained dollar buying by banks and continued foreign investor outflows.

At the interbank foreign exchange market, the local currency opened at 89.96 and subsequently slid to hit its all-time lowest level, pressured by weakness in domestic equity markets and uncertainty over the India-US trade deal, according to forex traders.

On Tuesday, the rupee had already hit an all-time closing low of 89.96 against the dollar, driven by strong importer demand and short-covering from market speculators.

Jateen Trivedi, VP Research Analyst, Commodity and Currency, LKP Securities, said, "The rupee slipped below the 90-mark for the first time, pressured by the absence of a confirmed India-US trade deal and repeated delays in timelines. Markets now want concrete numbers rather than broad assurances, leading to accelerated selling in the rupee over the past few weeks."

He added that rising global commodity prices were adding pressure to India’s import bill at a time when steep US tariffs continued to weigh on export competitiveness.

Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said, "The rupee has been weakening with the Government of India and the RBI wanting to help exporters and may have kept the dollar well bid in the past few days." He noted that nationalised banks bought dollars aggressively on Tuesday.

The Monetary Policy Committee (MPC) began its meeting on Wednesday, with the interest rate decision due on December 5, ahead of the US Federal Reserve’s announcement on December 10. "A rate cut by the RBI could invite further selling of the rupee," Bhansali added.

Meanwhile, the dollar index was 0.18 per cent lower at 99.17, while Brent crude futures slipped 0.03 per cent to USD 62.43 per barrel.

Equity benchmarks also weakened, with Sensex falling 277.23 points, or 0.33 per cent, to 84,861.04, and Nifty dropping 111.70 points, or 0.43 per cent, to 25,920.50. Foreign Institutional Investors sold equities worth Rs 3,642.30 crore on Tuesday, as per exchange data.