The rupee is trading lower at 60.24/25 versus its previous close of 60.03/04 as the dollar strengthens against most Asian currencies, but further falls in the Indian unit seen unlikely as traders expect dollar sales from exporters during the session.
Caution persists due to the Iraq crisis as Brent crude prices remained steady above $113 per barrel as fears of oil supply disruptions from Iraq offset the possibility of increased supply due to a thawing of relations between Iran and the West.
Traders expect the Reserve Bank of India to step in to check any spikes in the pair. The rupee hit a near two-month high of 60.55 per dollar on Tuesday but scaled back after traders spotted dollar sales from the central bank through state-run banks.
The U.S. dollar held onto modest gains early on Wednesday, having risen broadly after U.S. consumer prices recorded their largest increase in more than a year in May.
Caution also prevails ahead of the outcome of the U.S. Federal Reserve's two-day meet that ends later in the day.
The partially convertible rupee is seen trading in a range of 60.02 to 60.40 during the session.