Rupee falls 18 paise to ₹86.88 against US dollar in early trade

The rupee depreciated 18 paise to ₹86.88 against the US dollar in early trade on Tuesday as month-end dollar demand and sustained foreign fund outflows weighed on the local unit.

Forex traders said the domestic unit traded with a negative bias as the demand for dollars from importers continued to keep the American unit well bid against the rupee.

Moreover, a muted trend in domestic equities and sustained foreign fund outflows further dented investors' sentiments, they said.

At the interbank foreign exchange market, the rupee opened at ₹86.76 and then touched an early low of ₹86.88 against the American currency, registering a fall of 18 paise over its previous close.

On Monday, the rupee had settled at ₹86.70 against the dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose marginally by 0.01% to 98.64.

Brent crude, the global oil benchmark, went up by 0.04% to USD 70.07 per barrel in futures trade, as developing trade agreements eased tariff concerns and boosted future energy demands.

Meanwhile, in the domestic equity market, Sensex was trading 51.09 points or 0.06% higher at 80,942.11, while Nifty rose 18.30 points or 0.07% to 24,699.20.

Foreign institutional investors (FIIs) offloaded equities worth ₹6,082.47 crore on a net basis on Monday, according to exchange data.