Rupee falls 7 paise to 95.68 against US dollar in early trade

On Tuesday, the Indian rupee slipped 7 paise to 95.68 against the US dollar in early trade, influenced by high crude oil prices and ongoing demand for the greenback. Oil prices, particularly Brent crude near $91 per barrel, heightened dollar demand owing to the Reserve Bank of India's unexpected shutdown of the concessional forex-swap facility (FCN(B)).

The rupee opened at 95.68, marking a 7 paise decrease from its prior close. On Monday, the rupee depreciated 19 paise to 95.61 against the US dollar. Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors LLP, attributed the rupee's decline to escalating oil prices and the lack of progress in negotiating a peace deal between the US and Iran.

The dollar index, which measures the greenback's strength against a composite of six currencies, was trading at 99.63, down 0.01 percent. Meanwhile, Brent crude, the global oil reference, experienced a 0.52 percent increase, reaching $91.34 per barrel in futures trade. Analysts anticipate the rupee to remain vulnerable to rising oil prices, which have hovered around $90 and surpassed $91 per barrel.

The Reserve Bank of India (RBI) might maintain support levels around 95.61 or 95.75, given the persistent demand from oil companies and rising oil prices, according to Bhansali. In the domestic equity market, the Sensex fell 278.32 points to 77,450.64, while the Nifty dropped 57.65 points to 24,230.45. Foreign institutional investors sold equities worth ₹2,535.10 crore net on Monday, as per exchange data.