Business · India Bureau
Rupee weakens to 96.13 per dollar amid global headwinds
The Indian rupee depreciated 16 paise in early trading as crude oil prices remained elevated and U.S. yields climbed, triggering capital outflows from emerging market assets. The combination of factors is expected to keep the domestic currency under sustained pressure.
LSN India ·
The rupee slipped to 96.13 against the U.S. dollar in early market dealings, marking a loss of 16 paise as multiple external factors weighed on sentiment toward emerging market currencies. According to forex market participants, the weakness reflects a confluence of headwinds that have intensified selling pressure on the rupee and similar regional currencies.
Firm international crude oil prices continue to strain India's external account, while a sharp rise in U.S. nominal and real yields has made dollar-denominated assets more attractive to global investors. The combination is triggering a rotation of portfolio capital away from emerging markets, including India, into safer U.S. assets offering higher returns.
The dual pressure from oil costs and yield differentials has proven difficult for emerging market currencies to resist, with the rupee bearing the brunt of broader capital flight patterns. Analysts expect the depreciation trend to persist as long as these macroeconomic conditions remain in place, with the strength of the U.S. dollar likely to remain a key headwind for the Indian currency in coming sessions.