At 84.40 against the US dollar, the rupee reaches a record low.

Mumbai, Nov 12 (PTI) – The rupee slid by 2 paise to a new record low of 84.40 against the US dollar in early trade on Tuesday, pressured by ongoing foreign fund outflows and the strength of the dollar in global markets, which weighed on investor sentiment.

Forex experts noted that the rupee is likely to trade between 83.80 and 84.50 in the medium term, with the Reserve Bank of India (RBI) poised to cushion further depreciation, backed by robust foreign exchange reserves.

At the interbank foreign exchange, the rupee opened at 84.39 against the dollar before falling to its all-time low of 84.40, a decline of 2 paise from its previous close.

On Monday, the rupee had dipped by 1 paise to a lifetime low of 84.38 per US dollar, marking its fourth consecutive session of losses.

"The RBI plays a pivotal role in stabilizing the rupee and limiting depreciation. Despite a 6.30 percent drop in the Emerging Market Currencies Index since October 2, the rupee has only weakened by 0.69 percent, underscoring the RBI’s strong support," said Amit Pabari, MD of CR Forex Advisors.

Meanwhile, the dollar index, which measures the greenback against a basket of six major currencies, rose 0.09 percent to 105.63.

In global oil markets, Brent crude slipped 0.25 percent to USD 71.65 per barrel in futures trade.

In domestic equities, the Sensex gained 77.35 points, or 0.02 percent, to 79,573.50, while the Nifty climbed 19.90 points, or 0.08 percent, to 24,161.20.

On the capital markets front, Foreign Institutional Investors (FIIs) were net sellers on Monday, offloading shares worth Rs 2,306.88 crore, as per exchange data.

"Foreign investments in Indian stocks have sharply declined, with more than USD 2 billion withdrawn in November and USD 11 billion in October. This trend highlights the impact of high stock valuations and subdued Q2 earnings, which have reduced foreign capital inflows," Pabari added.

Separately, an SBI research report on Monday indicated that the rupee could depreciate by 8-10 percent against the US dollar under a hypothetical second term for former President Donald Trump.

The report, titled "US Presidential Election 2024: How Trump 2.0 Impacts India's and Global Economy," suggested that while the rupee may face a brief period of depreciation, it could also experience subsequent appreciation against the dollar.