Rupee pares all gains, drops to fresh record low of 71.79 against USD

The rupee pared initial gains to drop to a fresh all-time low of 71.79 against the US currency, falling 21 paise in late morning deals on Wednesday on sudden bouts of dollar-buying by banks and importers. Earlier, the rupee resumed higher at 71.43 against Tuesday's closing level of 71.58 a dollar at the interbank foreign exchange market here.

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The Indian unit was trading on a volatile note, moving in a wide range quoting between 71.40 and 71.79 during morning deals."Rupee's speculative demand is causing volatility amid crisis in the emerging market currencies and consistent rise in the crude oil prices," a dealer said.

The dollar strengthened against a basket of currencies overseas as the US economy continued to exhibit strength amid a lingering threat of escalation in the US-China trade conflict, leading to a fall in the domestic unit.

Meanwhile, the 30-share BSE Sensex is modestly lower by 29.83 points or 0.08 per cent at 38,128.09 at 1100 hrs.