The rupee came within striking distance of a nine-month low on Tuesday on heavy defence-related buying of dollars, although exporters helped prevent a bigger slide by selling the greenback.
The rupee dropped to as low as 55.9950, just short of breaching the 56.01 level touched last Thursday, which had marked the currency’s weakest level against the dollar since early September 2012.
The rupee has fallen heavily this month despite huge foreign inflows into stocks and debt amidst a global rally in the dollar and concerns about India’s current account deficit.
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