The Indian rupee depreciated by 16 paise to close at 89.79 against the U.S. dollar on Wednesday. This decline was attributed to persistent capital outflows from foreign investors and increased demand for dollars from bullion importers. Despite the Reserve Bank of India's announcements of USD INR swaps and Open Market Operations, market sentiment remained subdued amid strong dollar demand and rising crude oil prices. The rupee had opened stronger but pared gains by the trading session's end.