The rupee depreciated by 34 paise to close at 96.59 (provisional) against the U.S. dollar on Wednesday (July 22, 2026), weighed down by surging crude oil prices and heightened geopolitical uncertainty.

Forex traders said risk aversion in global markets and a negative trend in domestic equities further dented investor sentiments.

At the interbank foreign exchange, the rupee opened at 96.36 against the U.S. dollar and traded in the range of 96.25 to 96.57 during the day. The domestic unit finally settled at 96.59 (provisional), lower by 34 paise from its previous close.

On Tuesday (July 21, 2026), the rupee had settled higher by 11 paise at 96.25 against the American currency.

“Following a brief rally on Tuesday, the Indian rupee faces downward pressure amid surging crude oil prices and heightened geopolitical uncertainty,” said Dilip Parmar, Senior Research Analyst, HDFC Securities.

According to Mr. Parmar, renewed concerns over U.S. tariff rhetoric have further dampened sentiment. Spot USD-INR remains on a bullish track, with near-term support pegged at 96.10 and a retest of the record high around 97 on the horizon, he said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.07% at 101.10.

Brent crude, the global oil benchmark, was trading 4.30% higher at $94.92 per barrel in futures trade.

Forex traders said crude oil prices remain elevated amid concerns over the security of oil shipments through the Red Sea and Strait of Hormuz.

“Crude oil prices rose as the U.S. struck Iran and Iran struck U.S. facilities in Kuwait, Bahrain and Jordan. Houthis have also threatened to target vessels carrying oil from Saudi Arabia in the Bab el-Mandeb,” said Anuj Choudhary, Research Analyst, Mirae Asset Share Khan.

“A sharp surge in crude oil prices too weighed on the rupee. However, diplomatic talks between the two nations may prevent a sharp fall in the rupee. Any intervention by the RBI may also support the rupee at lower levels,” Mr. Choudhary said, adding that the USD-INR spot price is expected to trade in a range of 96.25 to 96.85.

On the domestic equity market front, Sensex tanked 715.06 points to settle at 76,755.05, while the Nifty declined 191.45 points to 23,996.25.

Foreign Institutional Investors turned net buyers, purchasing equities worth ₹1,650.16 crore on Tuesday (July 21, 2026), according to exchange data.