Another shocker! Rupee hits new bottom against Pound

Rupee on Tuesday hit a fresh bottom below 100 level against the British pound, even as the markets remain focussed on the Indian currency hitting a record low of sub Rs 64-level against the dollar.

The rupee hit a new low of Rs 100.35 against the British pound early this morning, as weak domestic fundamentals including ballooning current account deficit weighed down on the Indian currency.

After a modest recovery from its bottom, rupee was seen trading at Rs 99.7 against the British pound by mid-day trade.

The rupee has depreciated by about 25 per cent in the past three months, from close to Rs 83 in mid-May, while it was even higher at about Rs 80 against the British Pound in March.

At close to Rs 100 level, the British pound is the most expensive against the Indian rupee among major foreign currencies across the world, followed by euro (Rs 85), Swiss franc (Rs 69), US dollar (Rs 63.7), Canadian dollar (Rs 61.5), Australian dollar (Rs 57.8), New Zealand dollar (Rs 50.9) and Singapore dollar (Rs 49.8).

Against the US dollar too, the rupee on Tuesday hit a fresh low below Rs 64-level and slipped to as low as Rs 64.11 before marginally recovering to Rs 63.72 by mid-day

in the Interbank Foreign Exchange market.

The rupee had recorded the decade's worst single-day fall of 148 paise to close at record low of 63.13 on Monday, while it dropped further by about 98 paise this morning.

Forex dealers said besides strong demand for the American currency from importers and banks, dollar's strength against other currencies overseas amid expectation that the Federal Reserve will soon taper its bond-buying programme weighed on the domestic currency.

Continuing plunge in equity markets in view of sustained capital outflows by foreign funds is further adding to the pressure on the rupee.

In order to arrest the rupee slide, RBI last week had announced measures such as restriction on Indian firms investing abroad and on outward remittances by resident Indians, triggering fears of return of capital control regime.