The rupee depreciated 21 paise to 91.29 against the US dollar on Monday, weighed down by rising crude oil prices, a strong American currency and intense global volatility triggered by escalating Middle East tensions. At the interbank foreign exchange, the rupee opened at 91.23 and declined further to 91.29 against the greenback in early deals, trading 21 paise lower than its previous closing level. On Friday, the rupee had fallen 17 paise to settle at 91.08 against the dollar. Forex traders said negative sentiment in domestic equity markets and heavy withdrawal of foreign funds also pressured the Indian currency.
Dollar Index and Brent Crude Climb
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.22 per cent higher at 97.78.
Brent crude, the global oil benchmark, surged 3.91 per cent to 76.78 per barrel in futures trade.
Analysts said crude prices soared after the US and Israel launched military strikes against Iran. In the latest offensive, US and Israeli forces struck targets across Iran on Sunday, dropping massive bombs on ballistic missile sites and destroying warships. The attack intensified following the killing of Iran’s Supreme Leader Ayatollah Ali Khamenei.
Rising Oil Prices Raise Import Bill Concerns
Experts said India faces the risk of a sharp increase in its import bill due to rising crude prices in the international market, as nearly 85 per cent of the country’s fuel requirement is met through imports.
Equity Markets Under Pressure
On the domestic equity front, the Sensex tumbled 691.47 points, or 0.85 per cent, to 80,595.72 in early trade. The Nifty declined 240.95 points, or 0.96 per cent, to 24,937.70.
On Friday, foreign institutional investors offloaded equities worth Rs 7,536.36 crore, according to exchange data.
GDP Projection and Forex Reserves Update
According to government data released on Friday, following a revamp of the GDP calculation framework, the country’s economic growth has been projected at 7.6 per cent in the current fiscal.
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(This article is for informational purposes only and should not be construed as investment, financial, or other advice.)
