Mumbai, Oct 28 (PTI) The rupee depreciated 21 paise to 88.40 against the US dollar in early trade on Tuesday, weighed down by month-end dollar demand from importers and a surge in global crude oil prices.

Forex traders said investors are keeping a watch on Federal Reserve’s policy decision on Wednesday for further cues. Markets are assigning a 97.8 per cent probability to a 25-basis-point rate cut, with another one expected in December, they said.

At the interbank foreign exchange market, the rupee opened at 88.34, and slipped to 88.40 against the greenback, registering a fall of 21 paise from its previous close.

On Monday, the rupee plunged 36 paise to close at 88.19 against the US dollar.

"For now, the market seems to be balancing between short-term pressure and medium-term optimism. The rupee is expected to find strong resistance near 88.40, while support lies around 87.60–87.70. A break below that zone could open the door for a move toward 87.20," CR Forex Advisors MD – Amit Pabari said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.12 per cent to 98.66.

Brent crude, the global oil benchmark, rose 0.02 per cent to USD 65.63 per barrel in futures trading.

On the domestic equity markets front, Sensex climbed 125.93 points to 84,904.77 in early trade, while Nifty was up 39.8 points to 26,005.85.

Foreign Institutional Investors sold equities worth Rs 55.58 crore on Monday, according to exchange data.

Meanwhile, India's crude oil imports from the United States climbed to their highest level since 2022 in October, a move seen as part of New Delhi's effort to diversify supplies away from Russia and ease trade tensions with the Trump administration.

India's crude imports from the US reached 540,000 barrels per day as of October 27 - the highest since 2022, according to data from Kpler.

October is likely to close with near 575,000 bpd, and November looks to book around 400,000-450,000 bpd, per US export data - a sharp jump from the year-to-date average of around 300,000 bpd. PTI DRR DRR ANU ANU

Rupee falls to 88.40 amid importer dollar demand and rising crude; markets watch Fed policy closely. The rupee weakened to 88.40 per US dollar due to month end importer dollar demand and higher crude prices, with technical resistance near 88.40 and support around 87.60-87.70; a break below support could lead toward 87.20. Market watchers also cited Fed policy expectations. Separately, foreign institutional investors sold equities and India's crude imports from the US rose to about 540,000 bpd in October, reflecting a shift to diversify supplies.