Mumbai: The rupee slumped 98 paise to 70.58 against the US dollar in opening trade on Monday, tracking weak opening in domestic equity market and unabated foreign fund outflows.
Forex traders said, the US-China trade related concerns weighed on the investor community and kept pressure on the Indian rupee.
The massive decline in the Indian rupee was largely a knee jerk reaction to the slump in the Chinese currency after China's central bank allowed currency depreciation after the US decision to impose new tariff on Chinese goods, they said.
The rupee opened weak at 70.20 at the interbank forex market and then fell further to 70.58, down 98 paise over its last close. The rupee had settled at 69.60 against the US dollar on Friday.
However, easing crude oil prices and weakening of the American currency vis-a-vis other currencies overseas supported the local unit to some extent. Brent crude futures, the global oil benchmark, fell 1.23 per cent to USD 61.13 per barrel.
Foreign institutional investors (FIIs) remained net sellers in the capital markets, pulling out Rs 2,888.06 crore on Friday, as per provisional data.
Domestic bourses opened on a negative note on Monday with benchmark indices Sensex trading 533.94 points down at 36,584.28 and Nifty down 162.95 points at 10,834.40.
On the global front, the Chinese yuan fell to its lowest level against the dollar since August 2010 in morning trade on Monday.
The weakening was largely owing to US President Donald Trump's plan to impose fresh tariffs on another USD 300 billion in Chinese goods. The onshore yuan also tumbled, hitting 7.0307 on Monday morning trade to reach its lowest level since 2008.