Indian rupee ended around 1.04 percent down in a single day on May 8, which was most in more than three years after the tensions between Indian and Pakistan escalated, currency experts said.
The sell-off in the market was also witnessed after reports said that Defence Minister Rajnath Singh said that Operation Sindoor is still on and that India will hit back if Pakistan escalates the situation.
Along with this, pressure in the currency market was witnessed due ton outflows from the Indian equities. After a range-bound session, Nifty 50 and Sensex saw deepening losses towards the closing bell as investors rushed to offload their equity holdings amid rising geopolitical tensions, while uncertainty spiked as a result of the weekly expiry session.
The local currency ended at 85.7175 against the US dollar, which was down 1.04 percent compared to previous close of 84.8325 against the greenback. Such higher volatility or sharp depreciation was witnessed on March 7, 2022, when local currency was down 1.05 percent in a single day.
Currency experts said that there was Reserve Bank of India’s (RBI) intervention in the market at 85.49 levels, which helped the levels to come down by 10 paise on foreign exchange.
Today, rupee opened on a positive note by trading 20 paise higher as there were no new developments from the border even though tensions continued to build.
Singh, who was addressing an all-party meeting in New Delhi on India's strikes across LoC, said that around 100 terrorists were killed in Operation Sindoor, which took place early Wednesday.
Parliamentary affairs minister Kiren Rijiju told reporters after the meeting that it was convened to evolve a broad political consensus on the issue and leaders showed maturity and did not indulge in bickering.
"The Raksha mantri told the meeting that it was an ongoing operation and that is why he cannot share the technical details of Operation Sindoor that was launched by Indian armed forces," he said.
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