Rupee falls 3 paise to close at all-time low of 84.94 against U.S. dollar

Rupee hits all-time low against dollar due to demand, fund outflows, and weak equities, with FOMC decision awaited.

The rupee dropped 3 paise to close at an all-time low of 84.94 (provisional) against the U.S. dollar on Wednesday (December 18, 2024), as traders await cues from the US Fed on the interest rate front.

Forex traders said dollar demand from importers as well as foreign banks, foreign fund outflows and a muted trend in domestic equities further dented investor sentiments.

At the interbank foreign exchange, the rupee opened at 84.92 against the greenback, and touched 84.95 during intra-day trade. The unit finally ended the session lower by 3 paise at an all-time low closing level of 84.94 (provisional) against the dollar.

On Tuesday, the rupee revisited its all-time low closing level of 84.91 against the U.S. dollar.

"We expect the rupee to trade with a negative bias on weak domestic markets and concerns over slowdown in the economy. A strong US dollar and FII outflows may further weigh on the rupee," said Anuj Choudhary -- Research Analyst at Mirae Asset Sharekhan.

Traders may take cues from the current account balance and housing data from the US. Investors may also watch out for the Federal Open Market Committee (FOMC) meeting decision. The US Federal is expected to cut interest rates by 25 bps to 4.5 per cent.

"USDINR spot price is expected to trade in a range of 84.75 to 85.20," Choudhary added.