The Indian rupee is likely to open mostly unchanged on Tuesday, holding near its all-time low, with the dollar making its way to the highest in more than two months.

The decline in oil prices alongside expectations that the Reserve Bank of India will intervene are likely to counter the dollar's rally.

The 1-month non-deliverable forward indicated that the rupee will open nearly flat from 84.06 in the previous session. The currency dipped to a lifetime low of 84.0750 on Monday.

The dollar index touched 103.36 on Monday, the highest level in more than two months. Asian currencies were down with the offshore Chinese yuan weakening to 7.11 to the U.S. dollar and the Japanese yen just shy of 150.

The dollar index is now more than 3% higher than its recent lows, following the change in expectations on the size of the Federal Reserve's next rate cut. Investors have priced out the likelihood of another 50-basis-point cut after the robust U.S. jobs report.

The dollar is firm with Fed rate cut expectations remaining muted, said Srinivas Puni, managing director at QuantArt Market Solutions.

"USD/INR is meandering around the 84 zone, with no real momentum on the upside."

The RBI has made it evident that the rupee weakening past 84 does not mean that they were prepared to loosen their stranglehold on the currency, according to traders.

The U.S. jobless claims data, due Thursday, is the next key print that the market participants are eyeing, given the Fed's focus on the labour market.

OIL PRICES, EQUITY FLOWS

Oil prices dropped in Asia trading with Brent crude now down more than 7% from last week's peak. A media report that Israel is willing not to strike Iranian oil targets prompted investors to dump oil futures.

Meanwhile, foreign outflows from Indian equities continued with month-to-date sales approaching USD 8 billion.