The rupee depreciated by six paise to 74.99 against the US dollar in early trade on Wednesday, tracking Asian currencies and weakness in domestic equity markets.
Forex traders said steady crude oil prices and foreign fund inflows supported the rupee, while factors like strong dollar, muted domestic equities and rising COVID-19 cases dragged the local unit down.
“The RBI continued to buy dollars and pay forwards, crushing shorts in trade yesterday. We could see similar price action today as well. There is not much on the data front. Price action is likely to largely flow driven,” said Abhishek Goenka, founder and CEO of IFA Global, a forex advisory firm.
“The rupee is likely to trade in a range of 74.70-75.10 intraday. Nationalised banks may continue to intervene to smoothen volatility,” he added.