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Rupee Hits Record Low of 92.18 Amid US-Iran Tensions
Rupee All-Time Low: The impact of rising crude oil prices amid US-Iran tensions was clearly visible on the Indian currency. The rupee reached a record low against the dollar in early trading. Selling by foreign investors and a shift towards safer investment options increased the pressure. Fears of higher imports deepened concerns about the trade balance.
A sudden increase in the price of crude oil due to tensions between the US and Iran in West Asia seemed to affect investor sentiment. The rupee fell 69 paise to a record low of 92.18 against the US dollar in early trading on Wednesday.
The rupee opened at 92.05 in the foreign exchange market and soon touched a new low of 92.18 per dollar. This is a fall of 69 paise from its previous close of 91.49. It may be noted that the foreign exchange market was closed on Tuesday due to Holi.
According to forex traders, the sharp rise in Brent crude prices following the Iran crisis has put significant pressure on the domestic currency. Brent crude crossed the $82 per barrel mark in futures trading, prompting investors to shift to safer investment options. Meanwhile, continued foreign capital outflows and concerns about the potential impact on the trade balance due to higher imports are also putting pressure on the rupee.
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The dollar index, which measures the dollar's strength against six major currencies, was trading 0.03 percent higher at 99.08. Global oil benchmark Brent crude futures were up 1.01 percent at $82.22 per barrel.
Experts say the rise in international crude oil prices poses a risk of a sharp increase in India's import bill, as approximately 85 percent of the country's fuel needs are met through imports.
The domestic stock market also witnessed a decline. The BSE Sensex fell 1,671.39 points, or 2.08 percent, to 78,567.46, while the Nifty fell 502.35 points, or 2.02 percent, to 24,363.35. Foreign institutional investors sold shares worth ₹3,295.64 crore on Monday, according to exchange data.
