The rupee fell 20 paise to 95.95 against the US dollar in early trade on Monday, 28 September. The drop came as global crude prices stayed high and foreign fund outflows continued.

Brent crude, the global oil benchmark, traded higher at about $106.81 a barrel. The dollar index, which tracks the greenback against major currencies, stood at 101.11.

Foreign investors sold Indian equities worth Rs 3,693.93 crore on a net basis on Friday, exchange data showed. High oil prices raise India’s import bill and put pressure on the currency.

India’s forex reserves fell $14.881 billion to $765.901 billion in the week ended 18 September, RBI data showed. The fall was mainly due to a drop in foreign currency assets.

Forex traders expect the rupee to trade in the 95.50-96.00 range. The RBI’s market intervention is likely to slow any sharp fall. A weaker rupee makes imports costlier and can push up inflation. The central bank watches the currency closely and steps in to curb sharp swings.