Rupee Weighed Down by Crude Prices, Dollar Index Rises

The Indian rupee has weakened against the US dollar in early trade on Tuesday, falling by 4 paise to 95.74.

This decline comes as elevated crude prices and importer dollar demand weigh on the currency.

However, the Reserve Bank of India's (RBI) continued intervention through state-run banks has helped prevent a sharper decline, keeping USD/INR in a narrow range.

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, notes that oil prices and RBI intervention will remain the key near-term drivers for the rupee.

The rupee has remained range-bound for the last two weeks, with oil companies and RBI buying dollars at the lower end while protecting the downside to the rupee by selling dollars near 95.75 levels.