The rupee pared initial gains and settled for the day lower by 14 paise to 86.59 (provisional) against US dollar on Tuesday, tracking heavy sell-off in the domestic equity market and a recovery in the US dollar index.

Forex traders said the dollar weakened from its 109 levels but clawed back to 108.66 as Donald Trump declared tariffs against Canada and Mexico in the near future but stopped short of declaring any tariffs against China.