The rupee reversed early gains to end 17 paise lower at 87.75 against the US dollar on Monday, pressured by persistent importer demand for the greenback, a rebound in crude oil prices, and foreign fund outflows.At the interbank foreign exchange market, the domestic currency opened at 87.56 and traded in a narrow range of 87.48 to 87.75 before settling at the day’s low. On Friday, the rupee had closed flat at 87.58 after recovering from intra-day losses, PTI reported.“The rupee opened higher on a weak US dollar index and positive domestic markets but later pared gains due to firmer crude oil prices and FII outflows,” said Anuj Choudhary, Research Analyst, Commodities Research, Mirae Asset Sharekhan. He added that the local unit may trade with a negative bias amid uncertainty over trade tariff issues between India and the US.Persistent foreign portfolio outflows could weigh on the rupee, though a weak US dollar may offer support at lower levels, Choudhary said. “Investors may remain cautious ahead of US inflation data this week. We expect USD-INR spot to trade in the 87.35–88 range,” he noted.Brent crude futures edged up 0.03% to $66.61 per barrel. The dollar index, which measures the greenback against a basket of six major currencies, was up 0.10% at 98.28.Investors are also awaiting India and US CPI inflation readings and developments from the planned August 15 talks between US President Donald Trump and Russian President Vladimir Putin on the Ukraine war. India has reiterated Prime Minister Narendra Modi’s position that this is “not an era of war” and has consistently called for dialogue and diplomacy to end the conflict.In domestic equities, the Sensex surged 746.29 points to 80,604.08, while the Nifty gained 221.75 points to close at 24,585.05.On the reserves front, India’s forex kitty fell by $9.322 billion to $688.871 billion for the week ended August 1, one of the sharpest weekly declines in recent months, according to RBI data. In the previous week, reserves had risen by $2.703 billion to $698.192 billion.Foreign institutional investors sold shares worth Rs 1,202.65 crore on Monday, exchange data showed.Traders also flagged pressure on the rupee from escalating trade tensions. On August 6, the US announced an additional 25% tariff on all Indian imports, doubling the total duty to 50% from August 27.
