The rupee fell by 7 paise to close below the 75 mark against the US dollar on Friday as a record spike in COVID-19 cases and losses in the domestic equities weighed on investor sentiment.

Forex traders said heavy selloff in domestic equities amid fears that a rapid resurgence of COVID-19 cases in the country can disrupt economic recovery kept investors on edge. At the interbank forex market, the local unit opened lower at 75.02 against the previous close of 74.94 and traded in the range of 74.75 to 75.07 during the day. The rupee finally ended at 75.01 against the US currency, registering a fall of 7 paise over its previous close.

"The second wave of COVID-19 in India is keeping market risk sentiment very light and the USDINR spot is afloat. So, the USDINR bulls will continue to be on driver's seat, but we will only have to look for RBI intervention. We expect a broader USDINR range to be 74.50-75.50," said Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.

With a record single-day rise of 3,32,730 new coronavirus infections, India's total tally of COVID-19 cases climbed to 1,62,63,695, while active cases crossed the 24-lakh mark, according to the Union Health Ministry data updated on Friday. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.34 per cent to 91.02. Brent crude futures, the global oil benchmark, were trading 0.06 per cent down at USD 65.36 per barrel.

On the domestic equity market front, the BSE Sensex ended 202.22 points or 0.42 per cent lower at 47,878.45, while the broader NSE Nifty declined 64.80 points or 0.45 per cent to 14,341.35. Foreign institutional investors (FIIs) remained net sellers in the capital markets, as they pulled out Rs 909.56 crore on Thursday, according to the provisional data.