MUMBAI: The Indian rupee breached the crucial 50-level on Friday against the greenback on sustained dollar purchases by foreign banks and stronger dollar overseas.
The rupee tumbled to 50.05 level after resuming weak at 50.00/01 a dollar ahead of Reserve Bank's mid-term review of monetary policy later in the day.
In quiet trade at the Interbank Foreign Exchange (Forex) market, the domestic currency moved between 49.93 and 50.05 in the initial thirty minutes of trading.
Foreign exchange dealers said melting stocks markets also influenced the rupee movement. The Bombay Stock Exchange benchmark Sensex moved down by 277 points at 9,494.38 in early trade.
On Wednesday, the government eased norms on overseas borrowing for Indian companies to boost inflows and help corporates raise funds for projects. But all these measures failed to cap the rupee movement.
The government said on Thursday that the rupee is expected to be less volatile with pressure on capital inflows easing.
"The value of rupee is something which is based upon a large number of parameters including capital inflows. With pressure easing on these parameters, rupee is expected to be less volatile," Economic Affairs Secretary Ashok Chawla said.
Meanwhile, Finance Minister P Chidambaram attributed depreciation of the rupee to redemption pressures faced by some FIIs.
Rupee has depreciated by around 21 per cent since the beginning of this fiscal.
