Business · India Bureau
Rupee weakens to 94.98 as oil prices, Middle East tensions weigh
The Indian rupee depreciated 5 paise to 94.98 against the US dollar in early Monday trade, pressured by surging crude oil prices and escalating geopolitical tensions in the Middle East. Weakness in the US dollar and treasury yields, however, limited losses for the domestic currency.
LSN India ·
The rupee opened at 94.92 at the interbank foreign exchange market before declining to a low of 94.98, marking a 5 paise drop from Friday's close of 94.93. Currency traders attributed the morning weakness to risk-averse sentiment gripping global markets amid heightened Middle East tensions, which have also pushed crude oil prices higher.
The currency traded within a narrow range throughout the early session, with support emerging from softness in the US dollar and declining US treasury yields. These factors helped contain the rupee's downside as investors balanced concerns over elevated oil prices against moderating returns on dollar-denominated assets.
The rupee has come under pressure over two consecutive trading sessions, having fallen 12 paise on Friday. Analysts expect the currency to remain range-bound in the near term, with the balance between global risk sentiment and relative currency strength proving crucial to its directional movement.
Crude oil, which has a significant bearing on India's import bill and current account deficit, continues to trade at elevated levels amid Middle East geopolitical developments. The strength of the US dollar and capital flows into emerging markets are likely to remain key factors influencing rupee movements in the coming sessions.