The rupee depreciated 4 paise to 79.87 against the US dollar in opening trade on Wednesday, tracking the strength of the American currency in the overseas market.

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At the interbank foreign exchange, the rupee opened at 79.84 against the dollar, then fell to 79.87, registering a decline of 4 paise over the last close.

On Tuesday, the rupee moved up 1 paisa to settle at 79.83 against the dollar.

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The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.11% to 108.74.

The dollar is supported by hawkish comments by Minneapolis Federal Reserve Bank President Neel Kashkari who said his biggest fear is the US central bank misreads the extent and persistence of price pressures and will need to deliver even more aggressive rate hikes to control inflation, said Sriram Iyer, Senior Research Analyst at Reliance Securities.

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Iyer added that most Asian and emerging market peers remained weak on Wednesday morning and could weigh on sentiments.

Meanwhile, global oil benchmark Brent crude futures fell 0.46% to USD 99.76 per barrel.

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On the domestic equity market front, the 30-share Sensex was trading 141.45 points or 0.24% lower at 58,889.85, while the broader NSE Nifty was down 50.15 points or 0.29% to 17,527.35.

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The foreign institutional investors (FIIs) bought shares worth a net Rs 563 crore, while domestic institutional investors (DIIs) sold shares worth a net Rs 215.2 crore in the Indian equity market on August 23, as per provisional data available on the NSE.    

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Wall Street had ended lower on Tuesday with the S&P 500 falling 9.26 points, or 0.2%, to 4,128.73. The Dow Jones Industrial Average fell 154.02 points, or 0.5%, to 32,909.59, while the Nasdaq Composite fell 0.27 points, or less than 0.1%, to 12381.30. Stocks of smaller companies held up better than the rest of the market, and the Russell 2000 index ticked up by 0.2%.