Rupee plunges below 50 level after 30 months

The rupee today closed below the psychological 50-level mark for the first time in the last two-and-a-half years against the US currency on sustained strong dollar demand and signs of fresh capital outflows.

At the Interbank Foreign Exchange (Forex) market, the rupee plunged to the level of 50.32 during intra-day tracking sluggish stock markets.

With the BSE benchmark Sensex recovering towards the end of the day, the local currecny also recovered some of the losses to settle at 50.01/02, down by 21 paise over the previous close. It had settled at 50.04/05 on April 29, 2009.

Meanwhile in New Delhi, Reserve Bank Governor D Subbarao met Finance Minister Pranab Mukherjee and discussed ways to deal with spiraling prices aggravated by a weak rupee.

Even as the rupee plunged to 30-month lows, dealers said there were no signs of RBI intervention in the market.

"There were no signs to believe that RBI has intervened in the market. There was not any excess selling of the dollar from any public sector bank which can indicate an indirect play by the central bank," a dealer from a private wealth management firm said.

However, a treasury official from a public sector bank said, "I personally believe that there must be some intervention," but added that the extent and amount of intervention is not known to the market.

The rupee moved in a range of 50.32 and 49.95 before settling at 50.01/02, showing a fall of 0.42%. Yesterday, it had tumbled by 65 paise or 1.32%.

The BSE benchmark Sensex settled lower by 151.25 points or 0.89%. According to the Sebi data, Foreign Institutional Investors pulled out USD 86.69 million yesterday.