The local currency closed 87 paise, or 1.26 per cent, down at 70.46 against the US dollar.
Oil prices jumped sharply after the US and China agreed to a 90-day truce in a trade dispute, and ahead of a meeting this week of the producer club Opec that is expected to agree to cut supply. Brent crude was hovering 3.85 per cent up at $61.75 around 4.50 (IST), while WTI crude was up 4.24 per cent at $53.09 per barrel.
“The rupee declined today on account of sharp rebound in the crude oil prices in the international market. Further India’s GDP and fiscal deficit data disappointed the market. Hence the rupee is under pressure. Focus will now shift to the RBI and Opec meetings,” said Rushabh Maru, Research Analyst, Anand Rathi Shares and Stock Brokers.
The six-member Monetary Policy Committee (MPC), headed by RBI Governor Urjit Patel, began its three-day policy review deliberations on Monday amid expectations of status quo on interest rate.
Experts are of the view that the RBI may not change the benchmark lending rate (repo) despite moderation in economic growth and easing inflation. The MPC meet will continue till December 5. The decision of the MPC will be placed on the RBI’s website in the afternoon of December 5.
India’s economic growth slowed to 7.1 per cent in the September quarter after peaking to an over two-year high in the first three months of this fiscal, as consumption demand moderated and farm sector displayed signs of weakness.