Forex dealers said fresh demand for the American currency from importers amid rise in crude prices weighed on the domestic unit. Besides, investors were treading the cautious path ahead of the RBI policy decision.
The rupee opened lower at 70.50 a dollar and dropped further to quote at 70.55, 9 paise down over its previous close.
On Monday, the local unit snapped its four-day rising streak and dropped by 88 paise, its biggest single-day loss in more than three months, to close at 70.46 against the US currency.
Crude prices are on a rebound after Russian President Vladimir Putin and Saudi Arabia’s Crown Prince Mohammed bin Salman agreed to extend their agreement to limit production to arrest a slump in global prices.
Crude oil prices surged over 1.07 per cent to USD 62.35 per barrel in global markets.
Traders said, fresh foreign inflows restricted the decline in the local unit.
Foreign institutional investors (FIIs) made fresh purchases worth Rs 293.12 crore Monday, as per provisional data.
The BSE benchmark dropped over 100 points in early trade Tuesday amid mixed cues from other Asian markets, rising crude prices, weak rupee and heavy selling by foreign investors.
The 30-share index was trading 133.27 points, or 0.37 per cent, lower at 36,107.73 at 0945 hrs. In similar movement, the NSE Nifty was trading 31.20 points, or 0.29 per cent, down at 10,852.55.