Rupee Falls 12 Paise To 94.50 Against US Dollar, Rising Crude Oil Prices And Weak Stock Markets Weigh On Indian Currency

Mumbai: The Indian rupee weakened by 12 paise to 94.50 against the US dollar in early trade on Thursday, pressured by falling domestic stock markets and rising global crude oil prices. However, a weaker dollar and declining US Treasury yields helped limit further losses.

Rupee Opens Lower Against US Dollar

At the interbank foreign exchange market, the rupee opened at 94.47 before slipping to 94.50 against the American currency, marking a decline of 12 paise from its previous closing level.

On Wednesday, the domestic currency had gained 53 paise to settle at 94.38 against the US dollar. Forex analysts said weak equity markets and expensive crude oil continued to influence the rupee's movement.

Crude Oil Prices Rise, Dollar Index Weakens

Brent crude futures climbed 1.58 per cent to USD 110.54 per barrel, raising concerns over India's oil import costs. Meanwhile, the dollar index declined 0.21 per cent to 101.56, offering some support to the Indian currency.

Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said foreign investment inflows linked to IPO activity and a softer dollar could support the rupee. He added that falling US Treasury yields and developments surrounding Russia's potential peace talks could improve sentiment.

Sensex, Nifty Decline Sharply

Indian stock markets witnessed significant selling pressure during early trading. The BSE Sensex dropped 642.51 points to 73,067.18, while the NSE Nifty 50 declined 241.35 points to 22,570.90. However, foreign institutional investors purchased shares worth Rs 1,022.32 crore on Wednesday.

Rupee Outlook: Key Levels To Watch

Anindya Banerjee of Kotak NEO expects the rupee to remain within the 94–97 range. He cautioned that renewed foreign portfolio outflows or crude oil approaching USD 120 could increase currency volatility.

Investors will now monitor US unemployment claims data, crude prices and foreign fund flows for further direction.