The Indian rupee today declined to a new low against the US dollar. The rupee settled at 78.87 versus the US dollar in early trade today. The rupee on Tuesday closed 48 paise lower at 78.85 against the US dollar due to continuous foreign capital outflow and buoyancy in crude oil prices.
The rise in crude oil prices also affected the Indian currency. Analysts said they may see further weakness in the rupee if crude oil prices continue to rise.
Central banks’ tightness and increased inflation are triggering vague concerns of a global growth slowdown, while the safe-haven dollar favors the index.
Foreign institutional investors were net sellers in the capital markets on Tuesday as they unloaded shares of value 1,244.44 crores as per stock exchange data. Foreign investors have pulled out $28 billion from the Indian stock market this year.