The Rupee closed weaker weaker on Tuesday, weighed down by a fall in local stocks and regional currencies, while likely intervention by the central bank limited the currency's decline. The deferral of Indian bonds' inclusion in a flagship global index also singed the rupee, but the multi-front pressure was blunted by dollar-selling intervention by the Reserve Bank of India across the non-deliverable forward and local spot market. Despite the headwinds, some analysts say a modest recovery could be on the cards for the rupee as seasonality turns positive. India's total bilateral trade with Iran stood at $1.34 billion for the first 10 months of 2025, according to India's commerce ministry. Meanwhile, market participants are also awaiting the release of key U.S. inflation data later in the day alongside keeping their eyes peeled for developments on the ongoing threats to the U.S. Federal Reserve's independence. The dollar pared earlier gains on Tuesday after December consumer inflation largely matched economists’ expectations, while the yen hit its lowest against the U.S. currency since July 2024 on concerns about more fiscal spending in Japan. The dollar index , which tracks its performance against a basket of currencies including the yen and the euro, was last up 0.15% on the day at 99.02, with the euro down 0.06% at $1.166. The Australian dollar was last down 0.21% against the U.S. dollar at $0.6696 after briefly bouncing to $0.6725 after the CPI data. Sterling weakened 0.05% to $1.3452. The dollar was boosted on Friday after data showed solid job growth in December, which further boosted expectations that the U.S. central bank will keep rates on hold at its January 27-28 policy meeting. Fed funds futures traders' pricing shows that a cut is not seen as likely until June. The yen was among the largest movers on Tuesday as concerns grew that the Japanese government will adopt more fiscally expansionist policies to boost economic growth. The Japanese yen weakened 0.51% to 158.95 per dollar. The rapid weakening in the yen is also putting traders on watch for a possible intervention to shore up the currency. Oil prices surged by about 3% on Tuesday as the prospect of disruptions to Iranian crude exports overshadowed possible increased supply from Venezuela. Brent futures jumped $1.88, or 2.9%, to $65.75 a barrel by 11:07 a.m. EST (1607 GMT), hovering around a three-month high. U.S. West Texas Intermediate crude climbed $1.79, or about 3%, to $61.29.......