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The rupee fell sharply for second day on the row to close at 61.18 against the American currency. The Indian unit was seen taking cues from other Asian currencies, which also lost against the strengthening dollar.
On Thursday the rupee lost over 50 paise to close at 60.54. Friday’s close means that the rupee has lost over 110 paise, or close to 2 per cent against the US currency in two days.
Intraday, the Indian unit moved between a high of 60.69 and a low of 60.19.
The Reserve Bank of India’s third bi-monthly monetary policy on August 5 will be a key trigger for the rupee next week.
Though certain key economic data like factory output and HSBC’s PMI pointed to the improving health of the Indian economy, much remains to be felt on ground.
The benchmark BSE Sensex shed over 400 points in the day, while the 50-stock index –Nifty-- lost over 100 points as foreign investors likely pulled back money after government data showed that the country’s fiscal deficit was way above comfort level. Also, the improving sentiments in the US led investors to seek safe haven investment options back home.
The US dollar index -- measured against a basket of currencies -- was trading at 81.48, up 0.04 per cent at 5.30 pm local time.
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