The rupee's collapse toward 80 per dollar gathered pace, with the currency falling to a new all-time weak close of 79.81, marking the third straight session of record lows even before data showed US inflation surged to a higher-than-expected 40-year peak.
That inflation print will further boost an already-rampant dollar on bigger-sized interest rate hike from the Federal Reserve later this month, including an even more aggressive policy tightening path, and in turn, push the economy into a recession.
PTI reported the rupee plunged 22 paise to close at a new all-time low of 79.81 against the US dollar, after settlements. That is just a whisker away from the next key psychological level of 80-to-a-dollar rate.
Bloomberg showed the rupee was last changing hands at 79.6350 per dollar after falling to an intra-day low of 79.6825, edging ever closer to the 80 mark.
While the currency breathed a sigh of relief earlier in the session on crude prices crashing below the $100-per-barrel mark, the reversal in energy prices back above that level on demand worries from a global recession pushed the rupee lower.
The rupee had tracked a generally upbeat mood in Asia trading hours this morning and domestic stocks opened on a positive tone, but the risks narrative to global financial markets remained ahead of the highly anticipated June US inflation report, which likely accelerated to a 40-year peak.
Global stocks, including Indian equity benchmarks, slipped on Wednesday and the euro lurked just above parity against the dollar, as traders waited to see if US inflation data later bolsters the case for another supersized Federal Reserve rate hike this month.
In the previous session, the rupee had collapsed to close at 79.59 against the greenback as the safe-haven stampede into dollar-denominated assets brushed aside almost every other currency.