The Indian rupee weakened against the US dollar in early trade on Monday despite sustained intervention by the Reserve Bank of India, which is expected to continue curbing exchange-rate volatility ahead of its upcoming policy decision. Rupee sentiment was pressured by a record net sell-off of over Rs 21,100 crore by foreign institutional investors (FIIs) on Friday, the highest single-day outflow in at least two years, amid the rebalancing of the MSCI Global Standard Index. Separately, the RBI announced on Friday that India's forex reserves dropped by $7.511 billion to $681.384 billion during the week ended May 22. Meanwhile, investors are closely monitoring diplomatic efforts to manage the Israel-Lebanon conflict, focusing on a phased de-escalation framework and direct bilateral talks brokered by US Secretary of State Marco Rubio.
The partially convertible currency is currently trading at 94.88, weaker by 3 paise from its previous close of 94.85 on Friday. The currency touched a high and low of 94.94 and 94.73 respectively.
