High oil prices, muted stock markets push Indian rupee down against UAE dirham

The Indian rupee declined 12 paise to 74.70 against the US dollar (20.35 against the UAE dirham) in opening trade on Wednesday, as muted Indian equities and elevated crude oil prices weighed on investor sentiments.

At the Indian interbank foreign exchange, the rupee opened weak at 74.70 against the US dollar, registering a decline of 12 paise from the last close. On Tuesday, the rupee slumped by 33 paise to close at a two-week low of 74.58 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell by 0.06 per cent to 95.67.

The Indian rupee opened weaker versus the dollar tracking the strength of the US bond yields and the greenback which got a lift on rate hike expectations, Reliance Securities said in a research note.

Moreover, the strength of crude oil prices will also weigh on the rupee this Wednesday, it added. Global oil benchmark Brent crude futures jumped 1.22 per cent to $88.58 per barrel.

On the equity market front, the 30-share Sensex was trading more than 370 points or 0.61 per cent lower at 60,382.83 while the broader NSE Nifty declined by more than 100 points or 0.57 per cent to 18,010.40.

(with inputs from PTI)

• Dubai