Rupee weakens in early trade as oil prices and stronger dollar weigh

The Indian rupee edged lower in early trading on Tuesday, pressured by rising global oil prices and a firmer US dollar.

The currency slipped 7 paise to 90.96 against the dollar in the interbank foreign exchange market, after opening at 90.91. On Monday, the rupee had strengthened by 5 paise to close at 90.89.

Traders said the uptick in crude prices and weakness in domestic equities weighed on sentiment. However, continued foreign institutional investor (FII) inflows helped limit sharper losses.

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, said the Reserve Bank of India (RBI) may be intervening to prevent the rupee from breaching the 91 level. “The Reserve Bank might be intervening to keep the rupee away from 91.00 levels, but the buying will itself allow it to go beyond 91.00 levels,” he noted.

The dollar index, which measures the greenback against a basket of six major currencies, rose 0.11per cent to 97.81 per cent. According to Bhansali, the index gained as investors repositioned portfolios, though it continues to face pressure following US President Donald Trump’s announcement of a 15 per cent global tariff after an adverse Supreme Court ruling.

In commodities, Brent crude — the global benchmark — climbed 0.85% to $72.10 per barrel, adding to concerns over India’s import bill and inflation outlook.

Domestic equities opened sharply lower. The BSE Sensex fell 525.29 points to 82,769.37 in early deals, while the NSE Nifty declined 145.85 points to 25,567.15.

Despite the weaker market tone, foreign institutional investors were net buyers on Monday, purchasing shares worth Rs 3,483.70 crore, according to exchange data.

With PTI inputs