The Indian rupee weakened against the US dollar on Tuesday, pressured by elevated oil prices and withdrawal of foreign funds from Indian capital market in wake of ongoing tensions in West Asia. Foreign institutional investors sold equities worth Rs 9,365.52 crore on a net basis on Monday, exchange data showed. Furthermore, weakness in the domestic equities, strong American currency and rising inflation concerns also continued to weigh on rupee. Government data revealed that India’s trade deficit narrowed to $27.1 billion in February, compared to January, while merchandise exports slightly declined 0.81 per cent to $36.61 billion. Imports, however, increased by 24.11% to $63.71 billion in February this year from $51.33 billion recorded a year ago. While, investors await the Fed policy, in which it is expected to leave interest rates unchanged.

The partially convertible currency is currently trading at 92.47, weaker by 19 paise from its previous close of 92.28 on Monday. The currency touched a high and low of 92.4750 and 92.3500 respectively.