The rupee settled flat at 83 against the US dollar on Tuesday, as the support from a rally in domestic equities was negated by a strong greenback overseas and rising crude oil prices.

At the interbank foreign exchange, the rupee opened at 83 against the dollar, and touched an intraday high of 82.98 and a low of 83.02.

The rupee finally settled at 83.00 (provisional), unchanged from its previous close.

On Monday, the rupee appreciated 7 paise to close at 83 against the US dollar.

Meanwhile, India's industrial production growth slowed to 3.8 per cent in December 2023, mainly due to poor performance of mining and power generation segments, according to official data released on Monday.

Retail inflation declined to a three-month low of 5.1 per cent in January, mainly due to subdued prices of vegetables, fruits and other food items, according to government data released on Monday.

"We expect the rupee to trade with a slight positive bias on positive Asian markets and fresh foreign inflows. However, positive tone in the greenback and rising crude oil prices may cap sharp gains," said Anuj Choudhary Research Analyst, Sharekhan by BNP Paribas.

Escalation of geopolitical tensions in the Middle East after Israel forces launched airstrikes in Rafah may also weigh on riskier currencies.

"Traders may take cues from US inflation data. US CPI is expected to cool down to 2.9 per cent from 3.4 per cent in the previous month, while core CPI is expected to cool down to 3.7 per cent from 3.9 per cent. USD/INR spot price is expected to trade in a range of ₹82.80 to ₹83.20," Choudhary said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.05 per cent higher at 104.21, ahead of the US inflation report.

Brent crude futures, the global oil benchmark, rose 0.85 per cent to $82.70 per barrel.

In the domestic equity market, the 30-share BSE Sensex closed 482.70 points or 0.68 per cent higher at 71,555.19 points. The broader NSE Nifty advanced 127.20 points or 0.59 per cent to 21,743.25 points.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Monday as they purchased shares worth ₹126.60 crore, according to exchange data.