Kamal Ghorui
The Indian rupee depreciated for the fifth consecutive day, falling 24 paise to 94.25 against the US dollar.
MUMBAI: The rupee closed at a record low of 95.09 against the US dollar on Monday, falling 18 paise from the previous close, as strong dollar demand from corporates and rising crude oil prices weighed on sentiment.Other oil-sensitive Asian currencies also weakened against the dollar, with crude oil prices rising to $110 per barrel, adding strain on oil-importing economies.According to a Reuters report, authorities are exploring measures to attract dollar inflows and strengthen foreign exchange reserves amid pressure from higher oil prices. Proposed steps include incentivising foreign currency deposits and easing tax conditions for overseas bond investors.During the session, the currency opened stronger in the interbank market but weakened through the day, influenced by importer hedging, maturing contracts, modest portfolio inflows, and domestic political developments.Global factors continued to dominate currency markets as the US dollar strengthened amid risk aversion linked to geopolitical tensions. The dollar index edged higher as ongoing conflict in West Asia and uncertainty around key shipping routes kept financial markets cautious. Reports of military activity in strategic waterways added to volatility.Persistent foreign capital outflows have also weighed on the currency, with net selling of about $20 billion in both equities and bonds during 2026.In global currency markets, the euro and pound weakened slightly against the dollar, while the yen showed volatility amid expectations of possible intervention. Policy tightening expectations in Australia weighed modestly on its currency.Domestic equities, however, ended higher, with benchmark indices posting moderate gains on improved sentiment over BJP’s victory in state elections. In forex markets, geopolitical factors had a more dominant impact than political developments.
