The Indian rupee drifted lower against the U.S. dollar in the evening session on Tuesday, touching an all-time low, as emerging markets fell after the downgrade of global growth forecast by the International Monetary Fund, citing trade disruptions.
The Washington-based lender slashed the global growth forecast to 3.7 percent for this year and next, from the 3.9 percent predicted in April.
Further undermining the currency was a surge in oil prices, which raised concerns over widening current account deficit in India.
Persistent dollar strength also weighed on the currency, as U.S. Treasury yields remained higher on hopes of further rate hikes in the U.S.
Indian markets also declined, with the benchmark BSE Sensex falling 198.84 points or 0.58 percent to 34,275.54, while the broader Nifty index was down 53.35 points or 0.52 percent at 10,294.70.
The rupee breached the key 74 mark, falling 2.9 percent to a record low of 74.53 against the U.S. dollar. The rupee had ended Monday’s trading at 72.45 against the greenback.
So far this year, the currency has fallen around 13.7 percent against the U.S. dollar.