Kamal Ghorui
The rupee fell to a record low of 93.12 against the US dollar on Friday, pressured by rising global uncertainty and higher crude oil prices amid the ongoing Iran war.The domestic currency declined 0.55% to breach its previous low of 92.63 recorded yesterday, extending losses to nearly 2% since tensions in the Middle East escalated. Global energy supply disruptions from the Mideast continue to threaten Asia’s third-largest economy by impacting its growth-inflation balance.Despite the currency weakness, domestic equity markets saw a recovery. The BSE Sensex rose over 900 points, or around 1%, while the Nifty 50 gained about 300 points, or 1.35%.Oil prices jumped close to $120 per barrel on Thursday after attacks on major energy infrastructure in the Gulf but retreated on Friday. Prices eased as Brent crude futures dropped as much as 3.39% to an intraday low of $104.96 per barrel, while US West Texas Intermediate (WTI) crude fell 3.22% to $92.47.However, crude prices remain elevated. As the conflict entered its third week, Brent crude has risen nearly 40%, from $77.74 on March 2 to $108.65 on March 19, adding to inflationary pressures and weighing on currency markets.Several European countries and Japan have offered to help ensure safe passage for ships through the Strait of Hormuz, while the US has announced measures to boost oil supply.The rupee is likely to remain under pressure, as concerns over rising oil prices have led foreign investors to withdraw more than $8 billion from Indian equities so far in March, marking the largest monthly outflows since January 2025. Economists warn that a sustained rise in energy costs could weigh on India’s growth and push up inflation.(With inputs from agencies)
