Rupee falls 18 paise to close at 95.34 against U.S. dollar

The rupee pared initial gains and settled for the day on a negative note, lower by 18 paise at 95.34 (provisional) against the U.S. dollar on Thursday (July 2, 2026), as the support from easing crude oil prices was negated by robust dollar demand from importers and corporate hedgers.

Forex traders said the Indian rupee opened higher on an overnight decline in the U.S. dollar following less hawkish comments from Fed Chair Kevin Warsh and a fall in crude oil prices. However, the rupee lost its initial gains on FII outflows and dollar demand from hedgers.

At the interbank foreign exchange market, the rupee opened at 94.95 against the American currency and traded in a range of 94.90-95.40 during the session.

The rupee finally closed at 95.34 (provisional), registering a decline of 18 paise from its previous close.

On Wednesday (July 1, 2026), the rupee depreciated 60 paise to close at 95.16 against the U.S. dollar.

“We expect the rupee to trade with a negative bias on uncertainty over the U.S. and Iran deal despite positive comments from U.S. President Donald Trump. However, any softening of the U.S. dollar on less hawkish comments from the Fed may support the rupee at lower levels,” said Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan.

“Declining crude oil prices may also support the rupee at lower levels. Traders may take cues from weekly employment claims and the non-farm payrolls report from the U.S. The USD-INR spot price is expected to trade in a range of 95.00 to 95.60,” said Mr. Choudhary.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 101.00, lower by 0.38%.

Meanwhile, Brent crude, the global oil benchmark, was trading lower by 1.43% at $70.55 per barrel in futures trade.

While a decline in global crude oil prices and RBI interventions propped up the local unit, the rupee is likely to stay under pressure amid continued geopolitical uncertainty and significant foreign fund outflows.

Foreign investors extended their selling spree in June, withdrawing ₹49,340 crore ($5.16 billion) from Indian equities, triggered by a combination of early-month global risk aversion, a preference for developed markets, soaring U.S. bond yields, and stretched valuations in the domestic market.

According to data from the Central Depository Services (India) Ltd, the total withdrawals by Foreign Portfolio Investors (FPIs) from Indian equities have surged to ₹2.7 lakh crore so far in 2026, surpassing the ₹1.66 lakh crore pulled out during the entire calendar year 2025.

On the domestic equity market front, Sensex jumped 579.48 points to settle at 77,502.12, while the Nifty surged 169.85 points to 24,175.70.

Foreign institutional investors sold equities worth ₹1,140.50 crore on a net basis on Wednesday (July 1, 2026), according to exchange data.