he Indian currency was hurt by fresh demand for the American currency from importers, mainly oil refiners, following higher crude oil prices. Dollar's strength against some currencies overseas also weighed on the domestic unit today. On Tuesday, the local currency had bounced back in a tepid fashion from the record closing low, gaining 6 paise to end at 70.10 against the US currency.
At the interbank foreign exchange market, the rupee opened lower at 70.32 a dollar against 70.10 previously and dropped further to a new low of 70.52 in late morning deals, down by 42 paise.
Overseas, the US dollar inched higher against basket of currencies in early Asian trade, after dipping to a four-week low overnight.Relief over the US-Mexico trade deal was dimmed by concerns that the China-US trade war will drag on for some time.
A sharp surge in trade deficit too impacted the rupee. Trade deficit soared to a near five-year high of $ 18 billion.The closing level of Indian rupee on Tuesday marked a recovery of 6 paise against the greenback, compared to the all-time closing low of 70.16 registered in the previous session.
On Wednesday, Asian shares crept marginally higher as optimism over the US-Mexico trade deal was quickly clouded by caution ahead of a looming deadline on tariffs with China. Oil markets were stable on Wednesday, buoyed by falling supplies from Iran ahead of U.S. sanctions but held in check by rising production outside the Organization of the Petroleum Exporting Countries.
Traders said crude prices have been supported by the prospect of U.S. sanctions against Iran, which will start to target its oil industry from November.Spot gold was hovering around $1,203.81 after running into profit-taking at $1,214.28, its highest level since August 10.
Meanwhile, the S&P BSE Sensex turned choppy after hitting a new life-time high of 38,989.65 on Wednesday. The broader Nifty50 was also cautious and was trading at 11,739.90 at 9:52 am.
(With Agencies Inputs)
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