Mumbai: The rupee slumped by 62 paise to close at 79.15 against the US dollar on Wednesday, marking its worst single-day fall in the current fiscal as widening trade deficit and US-China tensions dented the investor sentiment.
While foreign fund inflows and oil prices falling below USD 100 per barrel level lent some support to the local unit, renewed rate hike fears following hawkish comments of Fed officials pushed back the rupee to below 79 levels.
On Tuesday, the rupee rallied 53 paise -- its best single-day gain in over 11 months -- to close at an over one-month high of 78.53 against the US dollar.
At the interbank foreign exchange market, the local currency opened lower at 78.70 on Wednesday and fell further to the day's low of 79.21 as the dollar strengthened in the global markets.
The rupee finally settled at 79.15 to a dollar, showing a loss of 62 paise which is the steepest single-day fall since March 7, 2022. Brent crude futures, the global oil benchmark, fell 0.95 per cent to USD 99.58 per barrel.
The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.5 per cent to 106.77.
On the domestic equity market front, benchmarks staged a fag-end recovery to close in the green for the sixth straight session on Wednesday, propelled by IT counters and Reliance Industries amid continuous foreign fund inflows and a largely positive trend in global markets.
In a volatile session, the 30-share BSE Sensex ended 214.17 points or 0.37 per cent higher at 58,350.53. During the day, it hit a high of 58,415.63 and a low of 57,788.78.
The broader NSE Nifty went up by 42.70 points or 0.25 per cent to 17,388.15. Tech Mahindra was the top gainer in the Sensex pack, spurting 1.97 per cent, followed by TCS, Infosys, Titan, Asian Paints, ICICI Bank, Bharti Airtel and Reliance Industries.