Rupee slips 8 paise against US dollar as crude prices continue to rise

The rupee began Tuesday on a weak note, falling 8 paise to 95.38 against the US dollar in early trade, as uncertainty over the ongoing Middle East crisis and a rise in crude oil prices overnight weighed down the currency. Pressure also came from weakness in equity markets.However, foreign institutional investor (FII) inflows and intervention by the Reserve Bank of India (RBI) helped cushion the decline, forex traders said.The local currency opened at 95.38 against the US dollar at the interbank foreign exchange market and remained at that level till the time of publishing the copy. Rupee had ended Monday's session 13 paise lower at 95.30 against the US dollar.Brent crude, which had climbed sharply from around $84 a barrel on Monday, was trading 0.06 per cent lower at $87.67 per barrel in futures trade."Rupee traded in a relatively narrow range (on Monday) despite Brent rising towards USD 84. The downside was contained by RBI intervention, with state-run banks reportedly selling dollars on the central bank's behalf," Anil Kumar Bhansali, head of treasury and executive director, Finrex Treasury Advisors LLP, said."Today Brent has gone past $87 per barrel as Iran and the US continue to harbour the Strait of Hormuz uncertainty on fading hopes of a deal happening soon," he added.The dollar index, which gauges the greenback's strength against a basket of six currencies, was at 99.77, down 0.04 per cent.Domestic equities extended their weakness in early trade, with the Sensex falling 320.14 points to 78,204.40 and the Nifty declining 94.35 points to 24,490.85.Meanwhile, foreign institutional investors bought equities worth Rs 1,974.76 crore on a net basis on Monday, according to exchange data.Get the latest Business News and Live updates. Download the TOI app.