The Indian rupee fell 36 paise to Rs.79.61 against the US dollar on Thursday, as crude oil prices rose.
The local currency opened at Rs.79.22 on the interbank foreign exchange market, with an intraday high of Rs.79.22 and a low of Rs.79.69 versus the US dollar. It eventually closed at Rs.79.61, down 36 paise from its previous close of Rs.79.25.
Rupee would trade on a mixed note in the short term. Domestic market recovery from low levels, as well as FII inflows, may help the local currency, Forex traders said.
Meanwhile, the dollar index, which measures the strength of the greenback against a basket of six currencies, dipped 0.23% to 104.95 after official data revealed that U.S. inflation declined from a 40-year high in June to 8.5% in July due to reduced fuel prices.
Investors will now look for further clues from major domestic macroeconomic data points such as the index of industrial production (IIP), consumer price index (CPI), and trade balance reports due on Friday, the traders said.
Meanwhile, Brent crude prices rose 0.84% to $98.22 a barrel, the global oil benchmark.
On Indian stock market front, the BSE Sensex finished 515.31 points or 0.88% higher at 59,332.60 points, while the broader NSE Nifty climbed 124.25 points or 0.71% to 17,659.00 points.
According to exchange data, foreign institutional investors continued to be net purchasers in the capital market on Wednesday, purchasing shares worth Rs.1,061.88 crore.