The rupee failed to sustained its recovery and depreciated eight paise to close at 86.87 (provisional) against the US dollar on Wednesday due to a firm American currency and unending outflow of foreign funds.
According to forex traders, rupee stayed firm initially but lost grounds amid volatile domestic equity markets that also added to the trend of withdrawal by foreign institutional investors.
They said the easing crude oil prices supported the Indian currency at lower level but at the same time the currency markets saw muted participation awaiting cues from the inflation and industrial output data to be released by the government.
At the interbank foreign exchange, the rupee opened at 86.44 and moved between the high of 86.36 and the low of 86.91 against the greenback during intra-day. The unit ended the session at 86.87 (provisional) against the dollar, registering a fall of eight paise from its previous close.
On Tuesday, the rupee appreciated 66 paise, logging the maximum single-day gain since March 3, 2023, to close at 86.79 against the US dollar.
The steep surge came a day after the unit plunged to near 88 per US dollar-level during intra-day on Monday, though the currency ended the session with gains at 87.45 against the greenback.
