Rupee plunges to new low on rate cut hopes

EVEN THE NEAR-term premiums have fallen 22 bps for 1 month and 10 bps for 1 year. The latter improved with easing of liquidity conditions.

- Madan Sabnavis, chief economist at Bank of Baroda

"It is highly possible that the RBI may announce another $5 billion buy/sell swap. The market has discounted a rate cut, and therefore, it has reacted accordingly," said a forex trader with a state-owned bank.