Rupee has declined 19 paise to 93.09 against the US dollar in early trade on Tuesday amid a strengthening dollar and continued crisis in the Middle East.
The Indian currency, despite RBI intervention on dollar hoarding by banks, is under immense pressure due to constantly fluctuating oil prices.
Besides the foreign fund outflow from foreign investment institutions (FIIs), the impact was felt on the rupee due to a strong dollar and high yield on US treasury bonds.
While the Reserve Bank of India (RBI) is trying its best to support the decline in the currency, it has so far managed to prevent the decline of the Indian currency beyond 94 rupees per US dollar.
The rupee has been trading near record lows recently, with the decline going to historic lows in previous trading sessions due to high demand for the haven dollar.
High crude oil prices, combined with the ongoing instability in West Asia, have kept the rupee vulnerable over the past few weeks, according to market analysts.
Apart from international factors, domestic investor confidence has also been rattled due to persistent losses.
In one of the trading sessions, US president Donald Trump said, "The US was ending operations in Iran soon."
The investors' confidence had also returned, but his late-night press conference on the same day about expanding Iran operations by two to three weeks led investors to lose 10 lakh crore in a single day during the next trading session.
The Sensex and Nifty have seen volatility, with domestic equities trying to provide a slight buffer against the rapid decline.
Also read: Gold, silver outlook for FY27 remains moderately bullish
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