The rupee fell 7 paise to 89.97 against the U.S. dollar in early trade on Friday (January 9, 2026) amid sustained FII outflows and a rise in global crude oil prices.

The apprehension of further tariffs by the U.S. and weak sentiments at the domestic equity markets fuelled selling of equities by foreign investors, putting more pressure on the local unit, forex traders said.

At the interbank foreign exchange, the rupee opened at 88.88 against the U.S. dollar before slipping to 89.97, down 7 paise from its previous close.

The rupee settled 3 paise lower at 89.90 against the US dollar on Thursday, amid sustained outflow of foreign funds and a stronger greenback.

“There was huge volatility in the rupee market on Thursday as the RBI sold dollars at 89.99 and brought the rupee up to 89.73, and then FPIs bought dollars. The RBI has been capping the dollar upside presently, creating huge oversold positions for itself, which could keep the dollar well bid at lower levels as the RBI would try to square up positions,” Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

Meanwhile, the dollar index, which measures the strength of the greenback against a basket of six currencies, was trading flat at 98.93.

Brent crude, the global oil benchmark, was trading 0.53% higher at $62.32 per barrel in futures trade.

On the domestic equity market front, the 30-share benchmark index Sensex declined 78.84 points to 84,102.12, while the Nifty dipped 21.50 points to 25,850.85.

Foreign institutional investors offloaded equities worth ₹3,367.12 crore on Thursday (January 8), according to exchange data.

The rupee rose 5 paise to 88.10 against the U.S. dollar in early trade on Wednesday (September 10, 2025), aided by FII inflows and a weaker greenback against foreign currencies.

However, a moderate rise in global crude oil prices prevented sharper gains in the local unit, forex traders said.

At the interbank foreign exchange, the rupee opened at 88.11 against the U.S. dollar before inching up to 88.10, higher by 5 paise from its previous close.

The rupee had pared initial gains and dropped 6 paise to revisit its record low of 88.15 against the U.S. dollar on Tuesday. On Friday, the rupee touched the lowest-ever intraday level of 88.38 but pared losses to settle 3 paise higher at ₹88.09 against the U.S. dollar.

“FPIs had bought equities yesterday (Tuesday)… and there was a tweet from US President Donald Trump that India and the U.S. are continuing negotiations to address the trade barriers between the two nations and that he is looking forward to speaking with Prime Minister Narendra Modi,” Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was down 0.45% to 97.90.

Brent crude, the global oil benchmark, was trading 0.86 per cent higher at $66.96 per barrel in futures trade.

“Brent oil prices rose… making a gain of 0.86 per cent as Israel attacked Hamas leadership in Qatar, raising concerns about potential supply disruptions in the region,” Bhansali said.

On the domestic equity market front, the Sensex was up 363.39 points, or 0.45%, to 81,464.71, while the Nifty rose 117.60 points, or 0.47 per cent, to 24,986.20 points.

Foreign Institutional Investors bought equities worth ₹2,050.46 crore on Tuesday, according to exchange data.