Rupee falls 2 paise to 86.55 against U.S. dollar in early trade

Rupee weakens against dollar due to strong American currency, despite positive equity market sentiment and lower inflation rates.

The rupee pared its initial marginal gain and slipped 2 paise to 86.55 against the U.S. dollar in early trade on Wednesday (January 15, 2025) as the positive sentiment in the domestic equity markets was negated by elevated crude oil prices and massive withdrawal of foreign funds.

A retreating American currency, however, supported the Indian currency at lower level, forex traders said.

At the interbank foreign exchange, the rupee opened at 86.50 and touched 86.45 against the greenback in initial deals. However, the local unit soon pared the gains and traded at 86.55 against the dollar, 2 paise lower from its previous close.

On Tuesday, the rupee rebounded from its lowest-ever level and settled with a gain of 17 paise at 86.53 against the dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.03% lower at 109.07.

Brent crude, the global oil benchmark, rose 0.06% to $79.96 per barrel in futures trade.

In the domestic equity market, the 30-share BSE Sensex was trading 271.26 points, or 0.35%, higher at 76,770.89 points, while the Nifty was up 50.80 points, or 0.22%, at 23,226.85.