MUMBAI: The rupee depreciated 6 paise to 96.42 against the US dollar in early trade on Tuesday as heightened geopolitical uncertainty put pressure on most Asian currencies, including the rupee.
Forex traders said the rupee came under pressure from a combination of factors -- crude oil prices climbed on renewed geopolitical tensions, and demand for the US dollar increased as investors moved toward safe-haven assets.
At the interbank foreign exchange market, the rupee opened at 96.41 then touched 96.42 registering a fall of 6 paise from its previous close.
On Monday, the rupee had settled at 96.36 against the American currency.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 100.97 up 0.03 per cent.
Brent crude, the global oil benchmark, was trading lower by 0.65 per cent at USD 88.64 per barrel in futures trade.
As dollar index again rose to 100.97 while oil prices were well bid at USD 88.64 per barrel, traders weighed the US-Iran conflict and the Houthi-Saudi blockade which could again risk the Middle East oil supplies, said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
On the domestic equity market front, Sensex declined 58.89 points to 77,649.63 in opening trade, while the Nifty slipped 22.45 points to 24,216.05.
Foreign Institutional Investors offloaded equities worth Rs 1,121.04 crore on a net basis on Monday, according to exchange data.