Rupee tanks 46 paise to close at record low of 78.83 against U.S. dollar

The rupee is expected to trade on a negative note on risk aversion in domestic markets and continued selling pressure from foreign institutional investors (FIIs).

The rupee plunged by 46 paise to close at record low of 78.83 (provisional) against the U.S. dollar on Tuesday, weighed down by persistent foreign capital outflows and a surge in crude oil prices.

At the interbank foreign exchange market, the rupee opened lower at 78.53 against the greenback and finally settled at 78.83, down 46 paise over its previous close.

During the session, the rupee touched an all-time low of 78.85 against the American currency.

"The Indian rupee touched an all-time low against the U.S. Dollar amid weak domestic equities and a surge in crude oil prices. Sustained selling by foreign investors also put downside pressure on Rupee," Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas said.

The rupee is expected to trade on a negative note on risk aversion in domestic markets and continued selling pressure from foreign institutional investors (FIIs). Elevated oil prices may also weigh on the domestic currency, Mr. Choudhary said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.01% higher at 103.95.

Markets are reassessing their expectations of Fed rate hike. Traders may also take cues from the U.S. consumer confidence data, which is expected to worsen from the previous month.