NEW DELHI: The rupee slid to a fresh three-week low on Wednesday, its biggest one-day fall since early July, as the central bank stopped bond sales to a group of emerging markets and the Reserve Bank of India cut interest rates.
The benchmark rupee fell by 1.2% to 67.16 per dollar, the lowest since mid-July, when a surge in inflation pushed up prices.
The rupees yield hit its lowest since January after a sharp drop in June.
The benchmark 30-year bond rate was unchanged at 1.6% and the benchmark 10-year note at 2.16%.
The ruples outlook for next month has been boosted by an expected cut in interest rates by the central banks policy committee on Wednesday.
The rupee index was last up by 1 percentage point at 6.1965.
It is trading at about 65.17.
The rate cuts are aimed at slowing the pace of inflation, which rose to a record 6.4% in May, its fastest pace in five years.
The RBI has said the central and state governments are expected to make the final decision on interest rate cuts at a meeting of its policy committee in late June or early July.
The central bank has been trying to cool the rupee to the lowest levels since the financial crisis of 2008.
The government said it will ease restrictions on the sale of debt by the government-owned banks, which it says have been the biggest contributors to rising inflation.