By laksh5382 
Rupee The US dollar witnessed range-bound trade in early deals on Wednesday and it fell 3 paise to 84.07 amid significant outflow of foreign funds and strengthening of the American currency in the overseas market.
Forex traders said the rupee is likely to trade in a narrow range during the day as a stronger dollar and a soft trend in domestic equities weighed on the local unit, while weak crude oil prices and the Reserve Bank of India (RBI) There has been no intervention. The local currency may also find support at lower levels.
At the interbank foreign exchange, the rupee opened at 84.03 against the greenback. It touched 84.07 in early trade, showing a decline of 3 paise over its previous close.
On Tuesday, the rupee traded in a limited range and the rupee rose by one paise to 84.04 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.06 percent lower at 103.19.
According to traders, the rupee is under heavy pressure, mainly due to selling of nearly US$8 billion by foreign institutional investors (FIIs) in October.
“This selling stemmed from profit-booking by FIIs, as Indian equities are now seen as overvalued after a total of US$25 billion of inflows over several months. The dollar index is under pressure from strength that is above its two-month high It has reached a high of 103.25, said Amit Pabari, MD, CR Forex Advisors.
Pabari further said that despite these headwinds, the rupee’s fall seems limited, with the RBI ready to intervene if necessary.
“Global oil prices fell 5 percent on weak demand forecasts and reports that Israel is unlikely to target Iranian oil assets, reducing supply concerns,” he said.
Global oil benchmark Brent crude rose marginally 0.26 per cent to $74.44 per barrel in futures trade.
On the domestic equity market front, Sensex rose 40.90 points or 0.05 per cent to 81,861.02. Nifty rose 11.45 points or 0.05 percent to reach 25,068.80.
Foreign institutional investors (FIIs) were net sellers in the capital market on Tuesday as they sold shares worth ₹1,748.71 crore, according to exchange data.