Rupee Hits Record Low of 93.71 Amid Rising Crude Prices and Geopolitical Tensions

Rupee Hits Record Low of 93.71 Amid Rising Crude Prices and Geopolitical Tensions​

Mumbai, March 20 – The Indian rupee plunged by 82 paise, or nearly 1%, to close at a provisional all-time low of 93.71 against the US dollar on Friday. The sharp fall was driven by sustained foreign fund outflows and a surge in crude oil prices amid escalating geopolitical tensions.

Persistent Pressure on the Rupee​

Forex traders noted that the rupee is under significant pressure due to rising crude oil prices and a shift towards risk-averse sentiment among investors. Heightened geopolitical uncertainty is further contributing to higher energy costs, potentially widening the trade deficit and adding to inflationary pressures.

At the interbank foreign exchange market, the local currency opened at 92.92 against the US dollar and breached the 93-mark for the first time during the session. The rupee continued its decline and eventually settled at 93.71, down 82 paise from its previous close.

On Wednesday, the rupee had already slumped by 49 paise to its previous record low of 92.89 against the US dollar. Forex markets remained closed on Thursday due to Gudhi Padwa.

Expert Insights​

Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said, "The rupee hit fresh all-time lows on Friday amid geopolitical tensions in West Asia and FII outflows. Rising global crude oil prices have also put pressure on the rupee."

He added that all major central banks – including the US Federal Reserve, ECB, Bank of England, and Bank of Japan – maintained interest rates in their recent policy meetings, while signaling readiness to adjust monetary policy as needed amid inflation concerns.

Choudhary expects the rupee to continue trading with a negative bias, forecasting the USD-INR spot price in the range of Rs 93.20-93.80.

Global and Domestic Market Trends​

The dollar index, which tracks the strength of the US dollar against a basket of six currencies, was up 0.35% at 99.58. Brent crude futures rose 1.84% to USD 110.7 per barrel, reflecting ongoing pressure on the rupee from higher energy costs.

In domestic equities, the Sensex rebounded from Thursday's losses, climbing 325.72 points, or 0.44%, to 74,532.96, while the Nifty gained 112.35 points, or 0.49%, to 23,114.50.

Foreign institutional investors continued their net selling trend, offloading equities worth Rs 7,558.19 crore on Thursday, according to exchange data.

This combination of global crude price pressures, geopolitical uncertainty, and foreign outflows has created sustained headwinds for the rupee, keeping markets on alert.