The rupee is tipped to around 81.85 per U.S. dollar in early trades, against 81.6850 in the previous session.

The offshore yuan dropped 0.6% to 7.24 to the dollar following rare protests in major Chinese cities against the country's strict zero-COVID policy.

After opening lower, the rupee should receive "decent" support at around the 81.90 levels, a trader at a Mumbai-based bank said.

The pair (USD/INR) had thrice run into offers at the 81.85-81.90 levels last week, the trader pointed out.

Apart from that, the rupee should be helped by the oil prices, the trader added. Brent crude declined more than 2% to below $82 per barrel, the lowest level since January.

Concerns over China demand have prompted a nearly 14% slide in oil prices this month, the worst monthly performance in more than a year.

Chinese stock prices and U.S. equity futures declined alongside the yuan. Protests simmered in Shanghai early on Sunday as residents in several Chinese cities pushed back against COVID-19 curbs.

To help the economy, the nation's central bank said on Friday that it would cut the reserve requirement ratio for banks by 25 basis points.

Safe haven demand lifted the dollar against its major peers. The dollar index rose to 106.40. Treasury yields dipped.

Worries about the broader fallout of Chinese protests on global risk appetite are helping the dollar pause its recent slide.

The U.S. currency has struggled as U.S. inflation data and minutes of the November minutes have reinforced expectations that the Federal Reserve will slow down the pace of rate hikes.

KEY INDICATORS:

** One-month non-deliverable rupee forward at 81.93; onshore one-month forward premium at 14 paise

** USD/INR Dec futures settled on Fri at 81.80

** USD/INR Dec forward premium at 15.50

** Dollar index up at 106.38

** Brent crude futures down 2.2% at $81.8 per barrel

** Ten-year U.S. note yield at 3.65%

** SGX Nifty nearest-month futures down 0.4% at 18,589

** As per NSDL data, foreign investors bought a net $517.9 million worth of Indian shares on Nov. 24

** NSDL data shows foreign investors bought a net $58.4 million worth of Indian bonds on Nov. 24

(Reporting by Nimesh Vora; Editing by Savio D'Souza)

By Nimesh Vora