Rupee falls by 16 paise to 74.76 against US dollar

The rupee on Tuesday depreciated by 16 paise to close at 74.76 (provisional) against the US dollar due to month-end dollar demand from oil importers and a stronger dollar in overseas markets.

Investors' weak appetite for riskier assets also weighed on the rupee. Moreover, market participants are now eyeing the US Fed's meeting outcome for further cues.

At the interbank foreign exchange market, the local currency opened at 74.60 against the greenback and witnessed an intra-day high of 74.57 and a low of 74.80 during the session.

The rupee finally settled at 74.76, down by 16 paise over its previous close of 74.60. This is the second straight session of loss for the local unit. 

The rupee has declined by 33 paise against the American currency in two days.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.22 per cent up at 96.12.

"Rupee becomes the worst-performing currency among Asian currencies. Even after a sharp rebound in domestic equities, forex market traders were uncomfortable to take risk ahead of holiday and the Federal Open Market Committee (FOMC) meeting," said Dilip Parmar, Research Analyst, HDFC Securities.

Brent crude futures, the global oil benchmark, rose 1.48 per cent to USD 87.55 per barrel.

On the domestic equity market front, the BSE Sensex ended 366.64 points or 0.64 per cent higher at 57,858.15, while the broader NSE Nifty rose by 128.85 points or 0.75 per cent to 17,277.95.

Foreign institutional investors remained net sellers in the capital market on Monday, as they offloaded shares worth Rs 3,751.58 crore, as per stock exchange data.