Mumbai: The Indian rupee on Thursday touched a new milestone, falling to historical low of 72 a dollar amid concern that US President Donald Trump could order additional tariffs on China. This was the seventh consecutive day the rupee fell, its longest losing streak since May 2016. The rupee closed at 71.99 a dollar, down 0.32% from its Wednesday’s close of 71.76. It opened at 71.65 per dollar and touched a low of 72.11.

The Trump administration is planning to impose another $200 billion of tariffs on Chinese imports as early as this week, which would mark a significant escalation in the trade dispute between both countries. Analysts expect the yuan, which has lost more than 6% against the dollar in the past three months, will extend its decline if Beijing retaliates.

“Intensifying EM (emerging market) crisis, fear of a contagion and broad-based USD strength coupled with deteriorating domestic macro scenario and domestic political uncertainty are expected to keep the INR under pressure," said Kotak Economic Research in a recent note.

The brokerage firm expects a rupee range of 69-74 (earlier 67.5-71.0) for the rest of 2018-19 and does not rule out announcements of exceptional measures soon.

Fall in rupee from last few weeks is in line with other emerging currencies amid concern over the risk of contagion from Turkey and Argentina’s financial-market turmoil.

“The selloff in EM FX/rates markets has been broad based, but led mainly by Argentina and Brazil (in LatAm), Turkey and South Africa (in EMEA), and India and Indonesia (in Asia). Difficulty in financing current account deficits is only one of the driving factors; others include negative local political developments, US-led trade protectionism, limited orthodox policy responses. Driven by these market moves, we are sifting EM FX and rate markets for new opportunities in the near term," said Nomura Research in a note.

On Wednesday, finance minister Arun Jaitley has said the government is closely monitoring developments relating to Turkey, which have generated global risk aversion towards emerging market currencies, and India would address any situation arising in the context of the unsettled international environment.

“India’s foreign exchange reserves are comfortable by global standards and sufficient to mitigate any undue volatility in the foreign exchange market," Jaitley added.

Bond yields, too, gained, tracking the home currency. The 10-year bond yield stood at 8.056%, from its previous close of 8.049%. Bond yields and prices move in opposite directions

“Bond markets continued to endure the steady depreciation in the rupee," said Edelweiss Financial said in a note to its investors.

So far this year, the rupee has weakened 11.4%, while foreign investors have sold $261.20 million and $6 billion in equity and debt markets, respectively.

Benchmark Sensex Index rose 0.59% or 224.50 points to 38,242.81. Since January, it has gained 12.2%.