Rupee crashes to all-time low of 69.91 on Turkish lira shock

The US dollar strengthened against the world currencies after the Turkish lira dived almost 8 per cent, sparking a sell-off in global markets.

Illustration: Uttam Ghosh/Rediff.com

The rupee on Monday crashed by Rs 1.08 or 1.57 per cent to end at historic low of 69.91 against the US currency amid a global rout in currencies following fears that Turkish economic crisis could engulf world economy.

The US dollar strengthened against the world currencies after the Turkish lira dived almost 8 per cent, sparking a sell-off in global markets.

"The rupee was mainly impacted by fall in Turkish lira,” said a treasurer of a state-owned bank.

Lack of FII inflows and growing oil prices are also affecting the rupee, he added.

Foreign investors sold shares worth Rs 971.8 crore on net basis, provisional exchange data showed.

“RBI will not be comfortable at these levels. It was seen defending rupee at all levels,” said a senior treasury official of a public sector bank, while predicting that the rupee may fall to 70 levels against the dollar soon.

The rupee had opened strong by 41 paise at 68.42 against the US dollar in early trade on Monday, helped by revived sentiments following optimistic macroeconomic outlook.

However, it soon plunged to a low of 69.62in line with weakening domestic equities and meltdown in global markets.

Suspected RBI intervention helped it recover from heavy losses, but heavy dollar demand pushed the rupee to close at all-time low level of 69.91, a fall of Rs 1.08 or 1.57 per cent over the previous close.