Rupee falls 2 paise to 94.97 against U.S. dollar in early trade
The Indian rupee fell 2 paise to 94.97 against the U.S. dollar amid rising oil prices and geopolitical tensions between the U.S. and Iran. Market participants are also anticipating a potential Federal Reserve rate hike, which has strengthened the dollar index.
Why it matters
Currency fluctuations and rising oil prices directly impact India's inflation and import costs, signaling potential economic instability.
The rupee traded in a narrow range and fell 2 paise to 94.97 against the U.S. dollar in early trade on Wednesday (September 2, 2026), amid renewed U.S.-Iran tensions, higher oil prices and rising Treasury yields.
Forex traders said the RBI is keeping a tab on the rupee's fall as Brent crude prices have risen to $95 per barrel and dollar index is hovering around 99.70 on a bout of risk aversion on renewed U.S.-Iran tensions.
Moreover, market participants have raised the probability of a September Fed rate hike, pushing U.S. Treasury yields higher and triggering a broad dollar rally.
At the interbank foreign exchange market, the rupee opened at 94.97 against the U.S. dollar, registering a fall of 2 paise from its previous close. On Tuesday, the rupee settled at 94.95 against the US dollar.
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