The rupee dropped 6 paise to 94.69 against the US dollar in early trade on Tuesday amid mixed cues from the US Fed, a decline in crude oil prices, and a strengthening dollar.
Foreign institutional investors have been offloading billions from the Indian market, leading to a decline in stock indices, with fears of a sharp fall in crude prices also creating uncertainty among investors after the latest Iran-US talks in Switzerland.
At the interbank foreign exchange market, the rupee opened at 94.73 against the US dollar before slipping to 94.69, down 6 paise from its previous close.
The rupee had depreciated 30 paise to close at 94.63 against the US dollar on Monday.
The Indian currency opened flat against the US dollar due to mounting expectations of a Federal Reserve rate hike and broad-based dollar strength, which weighed on most Asian currencies.
The greenback touched a 13-month high amid positive developments from the US-Iran peace talks.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 101.04, up 0.02 per cent, amid a hawkish Fed stance and the fragile US-Iran trade deal.
Brent crude oil was also trading 0.46 per cent lower compared to its previous close.
Foreign institutional investors turned net sellers, offloading equities worth Rs 635.91 crore on a net basis on Monday, according to market data.
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