Rupee Hits All-Time Low of 92.40 Against US Dollar Amid Oil Surge and FII Outflows

Rupee Hits All-Time Low of 92.40 Against US Dollar Amid Oil Surge and FII Outflows​

Indian Currency Extends Losses as Global Pressures Mount​

Mumbai, March 17: The Indian rupee weakened further on Tuesday, slipping 12 paise to close at a record low of 92.40 against the US dollar, as rising crude oil prices and sustained foreign fund outflows weighed heavily on the domestic currency.

The rupee opened at 92.35 in the interbank foreign exchange market and fell to an intraday low of 92.47 before settling at its weakest-ever closing level of 92.40. This marks a decline from Monday’s close of 92.28, where the currency had already hovered near record lows despite a marginal 2 paise gain.

Crude Oil Rally and West Asia Tensions Pressure Rupee​

The depreciation in the rupee comes amid a sharp rebound in global crude oil prices, driven by ongoing geopolitical tensions in West Asia. Brent crude futures rose 2.65 percent to USD 102.86 per barrel, increasing concerns over India’s import bill and external balance.

Additionally, persistent selling by foreign institutional investors has intensified pressure on the domestic currency. Exchange data showed that FIIs offloaded equities worth Rs 9,365.52 crore on a net basis on Monday.

Domestic Markets Offer Limited Cushion​

While Indian equity markets ended higher on Tuesday, the gains failed to provide meaningful support to the rupee. The BSE Sensex rose 567.99 points to settle at 76,070.84, while the NSE Nifty advanced 172.35 points to close at 23,581.15.

A slightly softer US dollar and recovery in domestic equities helped limit sharper losses in the rupee, although the overall sentiment remained cautious.

Key Global Cues in Focus This Week​

Market participants are closely tracking major central bank decisions, including those from the US Federal Reserve, European Central Bank, Bank of Japan, and Bank of England, which are expected to influence currency movements globally.

The dollar index, which measures the strength of the US currency against a basket of six major currencies, was marginally higher by 0.05 percent at 99.52.

Trade Data and Inflation Signals Add to Outlook​

Recent government data indicated that India’s trade deficit narrowed to USD 27.1 billion in February compared to January. Merchandise exports declined slightly by 0.81 percent to USD 36.61 billion, while imports surged 24.11 percent to USD 63.71 billion year-on-year.

Separately, wholesale price inflation rose to an 11-month high of 2.13 percent in February, driven by an increase in food and non-food article prices, despite some easing in vegetable prices on a monthly basis.

Rupee Outlook​

The rupee has remained under sustained pressure and continues to rank among the weakest-performing currencies in Asia. During the session, it revisited its earlier intraday low of 92.47, a level first touched on March 13.

Currency markets are expected to remain volatile in the near term, with global cues, crude oil movements, and foreign fund flows likely to dictate the rupee’s trajectory.