The rupee fell by almost 3% against the US dollar amid uncertainty over the Middle East and a gloomy forecast for economic growth this year.
Goldman Sachs cut its GDP growth forecast for India to 4% from 6%.
It also expects the rupee, Asia’s worst performing currency this year, to sink to 72 per dollar within six months.
Ratings agency Standard & Poor’s said that there was a more than one-in-three chance of a ratings downgrade for India within the next one to two years.
In the April-to-June quarter, India’s economy grew at a rate of 4.4%, compared with the same period in the previous year, the slowest quarterly expansion in four years.
August also saw India’s manufacturing sector shrink for the first time for four years.
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