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The rupee pared its losses to settle flat at 85.40 (provisional) against the US dollar on Wednesday, amid volatile trading influenced by rising crude oil prices and a bearish trend in domestic equities.

Forex traders noted that increased month-end dollar demand lent strength to the American currency, putting pressure on the local unit. Meanwhile, investors remained cautious ahead of key domestic macroeconomic data releases.

India’s industrial production data for April is expected later in the day, with GDP growth figures for the first quarter of FY26 scheduled for release on Friday.

At the interbank foreign exchange, the rupee opened at 85.59 and fluctuated between an intraday high of 85.33 and a low of 85.72 against the greenback. The domestic unit closed at 85.40 (provisional), unchanged from its previous close. On Tuesday, the rupee had ended 30 paise lower at 85.40 against the dollar.

Also Read: Currency Market News: Rupee hits all-time low of 85.63 against US dollar, down 23 paise

According to Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities, "the rupee traded flat as the dollar index remained steady."

He added, "With major economic data lined up this week -- including the US Fed meeting minutes, Q1 GDP, and Core PCE Price Index -- the rupee's trajectory will largely be guided by foreign fund activity in the secondary markets. In the near-term, the rupee is expected to move within a range of 84.80 to 85.75."

The dollar index, which measures the greenback’s strength against a basket of six currencies, was up 0.05 per cent at 99.47. Analysts linked the greenback’s strength to improving US consumer confidence, supported by better-than-expected durable goods orders and consumer confidence data.

Brent crude, the global oil benchmark, rose 0.67 per cent to $64.52 per barrel in futures trading.

Also Read: Final Trade: Sensex ends 239 pts lower, Nifty slides to 24,752 as market extends losses to 2nd day; ITC leads FMCG stocks lower

Domestic equity markets posted modest losses on Wednesday, marking a second consecutive session of declines amid selling pressure in FMCG, energy, and auto sectors. Weakness in ITC shares, impacted by a large block deal and ex-dividend trading, weighed on both main indices. With the earnings season mostly behind, market focus shifted to global cues amid easing trade war concerns.

The Sensex closed 239.3 points lower at 81,312.3, while the Nifty 50 fell 73.8 points to 24,752.5. Foreign institutional investors (FIIs) were net buyers of equities worth Rs 348.45 crore on Tuesday, according to exchange data.

(With PTI inputs)

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