The Indian Rupee on Friday breached the 74-mark against the American currency for the first time to close at a record 74.10, after the Reserve Bank of India kept the key policy rate unchanged at 6.5 percent .

Just after the RBI announced its decision, post 2.30 p.m., the rupee plunged to over 74 a US dollar — the lowest ever mark — it has touched against the greenback.

It opened the day’s trade at the Inter-Bank Foreign Exchange Market at 73.64 (73.6375) to a dollar from its previous close of 73.58.

The RBI belied market expectations of a rate hike, which was expected to arrest the free fall in the rupee’s value.

As per the RBI’s fourth bi-monthly monetary policy statement, the key lending rates have been kept intact on the back of an uncertain global economic scenario.

The policy repo rate under the liquidity adjustment facility (LAF) remained unchanged at 6.5 per cent.

RBI governor Urjit Patel said tailwinds from the recent depreciation of the rupee could be muted by the slowing down of global trade and the escalating tariff war.

In absolute terms, the rupee has depreciated by over 15 percent making it one of the worst performing Asian currencies. However, the RBI governor has maintained that depreciation in rupee has been moderate compared to emerging market peers.

“In real terms, the rupee’s depreciation has been around,” he added.

(With inputs from IANS)