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Indian rupee weakened against the US dollar on Wednesday, driven by a muted trend in domestic equities and firm American currency at overseas markets. Meanwhile, investors are remained cautious and await the release of key US inflation report later in the week, which might provide insights on size of a likely September rate cut. However, some losses were limited by expectations of Reserve Bank of India (RBI) intervention and foreign fund inflows into Indian capital market. Foreign Institutional Investors were net buyers in the capital markets on Tuesday, as they purchased shares worth Rs 1,503.76 crore, exchange data showed.

The partially convertible currency is currently trading at 83.95, weaker by 2 paise from its previous close of 83.93 on Tuesday. The currency touched a high and low of 83.9575 and 83.9450 respectively.