Rupee Plunges to ₹95.32 Against Dollar as Israel-Iran Tensions Drive Crude Oil Prices Up
Currency Weakens Amid Geopolitical Instability
The Indian rupee depreciated by 37 paise on June 8, trading at ₹95.32 per dollar. This decline follows fresh tensions between Israel and Lebanon, which have significantly impacted global commodity markets.The local currency traded at this level compared to ₹94.95 per dollar in the preceding session. This movement occurred despite measures introduced by the Reserve Bank of India (RBI) aimed at stabilizing the rupee.
Crude Oil Rises as Peace Prospects Diminish
Brent crude prices spiked over the weekend, driven by renewed hostilities in the Middle East. The oil commodity is now trading slightly above $96 per barrel. This surge occurs after Israel conducted further strikes on Lebanon.These actions present another obstacle to achieving a comprehensive peace agreement between the United States and Iran. Oil prices increased more than 3 percent over the weekend, reflecting escalating geopolitical risks.
RBI Intervenes with Support Measures
On Friday, the RBI maintained its interest rate steady at 5.25 per cent. Concurrently, it announced several measures designed to prevent sharp depreciation of the rupee.A key intervention from the central bank included providing hedging cost support for overseas bank deposits. This support applies to both three-year and five-year deposits until September 30.
Market Outlook Hinges on External Factors
Amit Pabari, managing director at CR Forex Advisory, provided a view on the medium-term outlook. He noted that the USDINR is likely to break below ₹94.50.Pabari added that the currency could gradually move toward the ₹94.00 - ₹93.80 zone. However, he cautioned that external geopolitical factors will remain critical determinants of future currency movements.
Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
The information provided is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any securities. Readers are advised to rely on their own assessment and judgment and consult appropriate financial advisers, if required, before taking any investment-related decisions.
Any views, opinions, or statements expressed, where applicable, are those of the respective analysts or experts and do not reflect the views of this website. The website has no association with such viewpoints and does not assume any responsibility for them.