MUMBAI: The Indian rupee was unable to hold on to its opening uptick against the dollar on Tuesday, on likely importer interest to hedge their liabilities, traders said.

The rupee was trading at 81.44 per US dollar by 0442 GMT, compared with 81.26 in the previous session.

The local had managed to inch up to 81.14 in opening trades.

The price action was similar to that on Monday but within a narrower range. On Monday, the rupee climbed to near 80.50, before quickly reversing to below 81.

Yet again, there is very good demand for dollars from both private banks and foreign banks, likely related to their corporate clients, a spot trader said.

Asian currencies were mixed, with investors looking to assess how much last week’s US inflation data will impact the Federal Reserve’s rate path.

The central bank will likely soon slow its interest rates hikes, Fed Vice Chair Lael Brainard signalled on Monday.

Indian rupee tipped to extend rally as Fed-pivot hopes boost Asia FX

She was the second Fed official to indicate smaller-sized rate hikes after the lower-than-expected October inflation print.

However, both officials flagged that more work was needed to be done to bring inflation down to the Fed’s target, probably a signal to markets to not expect a dovish turn.

Oil prices, meanwhile, dipped on concerns over demand, while risk appetite in Asia was tepid after US equities slipped overnight.

Rupee forward premiums inched lower with the 1-year yield falling to 2.28%. Last Friday, this yield was above 2.40%.