Rupee plunges to over two-year low, RBI intervenes

The dollar's strength against other currencies kept rupee under pressure.

The Reserve Bank of India likely sold dollars through state-owned banks to stem the rupee's fall around 66.88 per dollar, three state-owned bank traders told Reuters.

In mid-morning trade, the Indian rupee was trading at 66.7950/8000 to the dollar, after plunging to an over two-year low at 66.8950.

The Indian rupee tumbled in line with its Asian peers due to persistent risk-off sentiment on the back of broad dollar strength.

Asian shares fell and the dollar held near an 8-1/2-month peak on Friday, while the euro hovered around seven-month lows on expectations of additional stimulus from the European Central Bank next week.

The rupee had tumbled 25 paise to close at over two month low of 66.57 against the US dollar in yesterday's trade on month-end demand for the American currency from importers and banks on the back of higher greenback in overseas markets.

Meanwhile, the benchmark BSE Sensex rose by 54.11 points,  to trade above 26,000-mark at 26,022.74 in early trade today.

Asian shares fell and the dollar held near an 8-1/2-month peak on Friday, while the euro hovered around seven-month lows on expectations of additional stimulus from the European Central Bank next week.