Rupee plummets 31 paise to fresh 1-yr low

The Indian rupee tumbled by 31 paise to a fresh one-year low of Rs 46.50 per US dollar in early trade today, extending its downward spiral against the American currency on sustained dollar demand from banks and importers in view of dollar firmness in overseas markets.

The rupee resumed lower at Rs 46.26/27 per US dollar on the Interbank Foreign Exchange here today, as against its previous close of Rs 46.19/20 per dollar, and moved down further to Rs 46.50 per dollar before quoting at Rs 46.46/47 per dollar at 1030 hours.

Persistent dollar demand from banks and importers on the back of a higher dollar in the New York market mainly affected the rupee value against the American currency, a forex dealer said.

In New York, the dollar extended its gains yesterday after Federal Reserve Chairman Ben Bernanke said he wasn't worried that the increase in inflation earlier this year would persist, but he didn't elaborate on whether or how the central bank could ease the rate of price rise further.