MUMBAI: The Indian rupee on Tuesday hit a record low against the dollar due to continued demand for the US currency, amid concerns over eurozone debt as well as weak domestic data.
The local unit dropped 35 paise to 53.29 against the greenback in early trade on the foreign exchange markets after tumbling 81 paise during Monday's session.
India's central bank has said that it will act to prevent a further downward spiral of the rupee, which has been hit by global financial uncertainty, as investors exit abandon emerging market currencies for safe havens.
The rupee has fallen about 14 per cent against the dollar since the start of this year and is the worst-performing of Asia's 10 most-trade currencies.
Depreciation has fuelled inflationary pressures, making imported goods like foreign crude oil more costly. Indian inflation is running at near double figures and is the highest among major global economies.
The new record low is further bad news for India's economy, which has also been hit by a slowdown in industrial growth. Figures for October, released on Monday, showed output shrank 5.1 per cent year-on-year.
Business leaders and economists are calling for action, including a halt in interest rate rises and key reforms, to help renew investor confidence and boost growth.
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