Indian Rupee Sinks To Record Low Against Dollar After RBI Keeps Rate Unchanged

The Indian rupee breached the 74 mark against the U.S. dollar in evening deals on Friday, touching an all-time low, after India's central bank kept its key benchmark rates unchanged unexpectedly after tightening the policy at the previous two meetings.

The six-member Monetary Policy Committee of the Reserve Bank of India decided to maintain the repo rate at 6.50 percent. The reverse repo rate was retained at 6.25 percent.

Five members of the MPC including Governor Urjit Patel voted in favor of keeping the policy rate unchanged, while Chetan Ghate sought a quarter-point rate hike.

The bank noted that oil prices remain vulnerable to further upside pressures and volatility in global financial markets continues to impart uncertainty to the inflation outlook.

The rupee lost 1.1 percent against the dollar, crashing to a historic low of 74.32. This follows a 2-day high of 73.48 touched when Indian marked opened for trading. The rupee had finished Thursday's trading at 73.79.

So far this year, the currency has fallen almost 15.8 percent against the greenback.

Indian markets also fell, with the benchmark BSE Sensex falling 792.17 points or 2.25 percent to 34,376.99, while the broader Nifty index was down 282.80 points or 2.67 percent at 10,316.45.