Rupee breaches 81 mark for a new lifetime low, markets continue to remain weak

Elsewhere in Asia, markets in Seoul, Tokyo, Shanghai and Hong Kong were trading lower.

The rupee depreciated 44 paise and slipped below the 81-mark against the U.S. dollar for the first time in early trade on September 23, 2022, weighed down by the strong american currency and risk-off sentiment among investors.

Forex traders said escalation of geopolitical risk in Ukraine and rate hikes by the U.S. Fed and Bank of England in a bid to contain inflation sapped risk appetite.

Further, the strength of the American currency in the overseas market, a negative trend in domestic equities, and risk-off moods amid escalation of geopolitical risk in Ukraine weighed on the local unit.

At the interbank foreign exchange, the rupee opened at 81.08 against the greenback, then fell further to 81.23, registering a fall of 44 paise over its previous closing.

On Thursday, the rupee plunged by 83 paise — its biggest single-day loss in nearly seven months — to close at an all-time low of 80.79 against the US dollar.

The Bank of England hiked its base rate by 50 basis points (bps) to a 14-year high of 2.25%.

The Bank of Japan intervened in the FX market for the first time in 24 years to stem a falling Yen after it kept rates at record lows, IFA Global Research Academy said, adding that the Swiss National Bank hiked rates by a record 75 bps to 0.5%.