Rupee hits record low, breaches 70 level against dollar

New Delhi: The rupee breached 70 per dollar mark in late morning trade on Tuesday amid fears that economic crisis in Turkey could spread to other global economies. At the interbank foreign exchange market, the rupee was trading higher by 0.21 percent at 70.07 against US dollar at 10.37 am.

In the opening trade rupee had recovered from all-time low of 69.91 and strengthened by 23 paise to 69.68 against the US dollar. Panic and capitulation overshadowed trading mood as traders and speculators saw no signs that monetary authorities would step into the foreign exchange market to support the domestic unit.

A PTI report said that the ongoing currency turmoil in Turkey has dampened investors' sentiments globally. Investors are turning to dollar as safe haven with Turkeys currency lira crisis continuing since the last week.

Yesterday, the Indian currency crashed by a mammoth 110 paise -- its biggest single-day fall in five years -- to end at a lifetime low of 69.93 as the US dollar gained rapid strength. This was the biggest single day fall for the rupee in the past five years. Previously, the rupee had dropped 2.4 per cent or 148 paise in a single day in August 2013.

Positivity was however seen in the stock market, taking comfort from better inflation numbers coupled with emergence of buying by domestic institutional investors.

The Turkish Lira has lost more than 40 percent against the dollar this year, largely due to worries about President Tayyip Erdogan`s influence over the economy, his repeated calls for lower interest rates, and worsening ties with the United States, a Reuters report has said. The currency pulled back from a record low of 7.24 to the dollar on Monday after the central bank pledged to provide liquidity, but it remained under selling pressure and its meltdown caused further unease on global markets.

With Agency Inputs