Rupee breaches 63/$; down 148p in decade's biggest drop

It was the biggest single day loss for the rupee in 18 years. Many analysts predicted that rupee will hit 65 by the year end. Looks like that may happen much sooner!

(Watch video for CNBC-TV18’s Latha Venkatesh’s report on how the day panned out for the currency and bond markets) The rupee today breached 63-mark a dollar to end at record low of 63.13, recording the decade's worst single-day fall of 148 paise, heightening fears that more capital control steps could be in the offing. Weighed down by heavy dollar demand and fall in stocks markets, the rupee fell to historic intra-day low of 63.30. At the Interbank Foreign Exchange (Forex) market, the local currency opened sharply lower at 62.30 a dollar from its previous close of 61.65 but tried to recover later to a high of 62.21. Rupee again turned negative and finally ended at 63.13, logging a fall of a massive 148 paise or 2.40 per cent. The previous biggest fall in decade was the 124 paise or 2.57 per cent plunge on September 22, 2011. Forex dealers said that overseas investors sat on the sideline on caution ahead of the release of the minutes of The Federal Open Market Committee on August 21. Meanwhile, bond yields have hit 9 percent for the first time in 5 years. In fact, they ended the day at 9.2 percent. Also read: RBI must stop defending rupee, cut rates for growth: Ambit (With inputs from PTI)