The rupee remained almost unchanged and was trading with a slight decline of 1 paisa at 87.22 against the US dollar in early trading on Wednesday, as market sentiment remained volatile due to uncertainties surrounding trade tariffs.
Forex analysts noted that the rupee was under pressure from a strengthening US dollar index and a rebound in crude oil prices. Additionally, selling in domestic equity markets and continuous outflows of foreign capital were weighing on the local currency.
Investors were treading cautiously as they awaited key macroeconomic data releases in both India and the US later in the day.
Opening at 87.24, the rupee briefly dropped to 87.32 before recovering to 87.22 against the dollar in early trading, reflecting a marginal 1 paisa decrease from its previous close.
On Tuesday, the rupee had ended 10 paise higher at 87.21 against the dollar, following a 36 paise decline the previous day.
Meanwhile, the dollar index, which measures the greenback against a basket of major currencies, was up 0.07% at 103.55.
Brent crude, the global oil benchmark, was trading 0.66% higher at $70.02 per barrel in futures trading.
In domestic markets, the BSE Sensex was down marginally by 0.28 points at 74,102.04, while the Nifty slipped 10.70 points to 22,487.20.
Foreign institutional investors (FIIs) sold equities worth ₹2,823.76 crore on a net basis on Tuesday, according to exchange data.
The uncertainty surrounding trade tariffs intensified after President Donald Trump initially announced a potential increase in steel and aluminum tariffs on Canada, only to later suggest he might reconsider the hike.
Overall, market participants were closely monitoring developments both globally and domestically for further cues on currency movements and trade dynamics.
