Rupee plunges 49 paise to 81.89 against US dollar as crude oil spikes

The rupee fell by 49 paise to close at 81.89 (provisional) against the US dollar on Monday as heavy selling pressure in the domestic equities and a spike in crude oil prices weighed on the local unit.

Besides, a stronger greenback against key rivals and persistent foreign fund outflows put pressure on the domestic currency, forex dealers said.

At the interbank foreign exchange market, the local currency opened weak at 81.65, fell further to 81.98 against the American currency.

It finally ended at 81.89, down 49 paise over its previous close.

In the previous session, the rupee settled at 81.40 against the greenback.

On the domestic equity market front, the 30-share BSE Sensex dropped 638.11 points or 1.11 per cent to end at 56,788.81, while the broader NSE Nifty fell 207 points or 1.21 per cent to 16,887.35.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.30 per cent to 112.45.

Global oil benchmark Brent crude futures surged 4.12 per cent to USD 88.65 per barrel.

Foreign institutional investors were net sellers in the capital market on Friday as they offloaded shares worth Rs 1,565.31 crore, as per exchange data.

After infusing funds in the last two months, foreign investors turned sellers again in September and pulled out Rs 7,600 crore from the Indian equity markets amid a hawkish stance by the US Fed and sharp depreciation in the rupee.