The rupee fell 6 paise to 95.42 against the US dollar in early trade on Wednesday, weighed down by the sharp rise in Brent crude toward USD 90 per barrel, as hopes of a quick US-Iran agreement and <a href="https://www.mid-day.com/news/world-news/article/strait-of-hormuz-will-not-reopen-until-us-ends-naval-blockade-says-iran--23644160" target="_blank" rel="none noopener">reopening of the Strait of Hormuz</a> faded.
Forex traders said the principal driver behind the rise in Brent crude prices is the uncertainty over the Strait of Hormuz.
Markets are increasingly sceptical about a quick US-Iran agreement, while reports of attacks on shipping have renewed concerns about physical supply, they said.
At the interbank foreign exchange, the rupee opened at 95.40 before slipping further to 95.42, down 6 paise from its previous close.
On Tuesday, the rupee declined 6 paise to settle at 95.36 against the US dollar. With Brent now near USD 90 per barrel, INR/USD at 95.50 becomes the immediate level to watch, followed by 95.80&ndash;96.00 if oil remains elevated, Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.
<a href="https://www.mid-day.com/business/business-news/article/global-crude-oil-prices-surge-over-3-per-cent-to-above-usd-90-per-barrel-mark-amid-west-asia-crisis-23640650" target="_blank" rel="none noopener">Brent crude</a>, the global oil benchmark, was trading higher by 1 per cent at USD 89.80 per barrel in futures trade.
"Rupee opened at 95.42 with oil prices slightly down at USD 89.36 per barrel while the dollar index was at 99.83 virtually unchanged. Oil companies continue to buy US dollars for their daily requirements while RBI continues to support the rupee at various levels daily," Bhansali added.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 99.87, up 0.05 per cent.
"Markets are largely in wait-and-watch mode ahead of the US inflation data, with the dollar receiving some support from elevated oil prices but limited by expectations that inflation may continue to moderate," Bhansali said.
On the domestic equity market front, Sensex dipped 35.99 points to 78,097.31 in early trade, while the Nifty skid 31.15 points to 24,444.55.
<a href="https://www.mid-day.com/business/stock-market/article/foreign-institutional-investors-offload-equities-worth-rs-7180-crore-amid-west-asia-crisis-23641524" target="_blank" rel="none noopener">Foreign institutional investors</a> purchased equities worth Rs 258.55 crore on a net basis on Tuesday, according to exchange data.
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The rupee opened at 95.40 before slipping further to 95.42, down 6 paise from its previous close against the US dollar during early interbank trade

Rupee falls 6 paise to 95.42 against US dollar on elevated crude oil prices

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At the interbank foreign exchange, the rupee opened at 95.40 before slipping further to 95.42, down 6 paise from its previous close. On Tuesday, the rupee declined 6 paise to settle at 95.36 against the US dollar

Rupee declines 6 paise to 95.42 against US dollar amid elevated crude oil prices

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