What’s the story
The Indian rupee has hit a new low, falling to 93.84 against the US dollar today.
The decline is mainly due to rising tensions in West Asia and a sudden spike in oil prices.
The rupee’s fall surpasses its previous low of 93.7350 recorded on Friday.
This marks a significant downturn for Asia’s third-largest economy amid fears of prolonged energy supply disruptions due to the ongoing conflict in the Middle East.
Geopolitical tensions and oil price surge impact Asian currencies
The ongoing geopolitical tensions have also impacted other Asian currencies, which have fallen between 0.1% and 0.8%.
The conflict has pushed oil prices up by over 50% this month, a situation that the International Energy Agency describes as worse than the two oil shocks of the 1970s combined.
The rupee, being one of the most vulnerable currencies to sustained oil price hikes, has weakened nearly 3% since the war began.
Bank of America revises rupee forecast
Bank of America’s Global Research division has revised its forecast for the rupee, now expecting it to trade at 94 by June 2026 instead of the previously projected 89. This revision is based on the assumption that the current crisis will be resolved in a few weeks.
