Rupee falls to a record low of 92.41 against US Dollar on higher crude prices, equity sell-off

The Indian rupee hit a record low of 92.41 against the US Dollar, extending their losses on Friday, March 13, as the US Dollar continued to strengthen, and oil prices remain at elevated levels.

The domestic currency opened at 92.35 per dollar, compared with Thursday’s (March 12's) close of 92.19, according to interbank foreign exchange data.

The rupee remains under pressure after touching a record low of 92.35 in the previous session, before recovering slightly amid suspected intervention by the Reserve Bank of India (RBI).

Oil prices have emerged as the key driver of market sentiment. Brent crude surged about 9% on Thursday to reclaim the $100-per-barrel mark, amid mounting concerns over potential supply disruptions.

Higher crude prices typically weigh on the rupee as India is a major importer of oil. Sustained strength in energy prices can widen the country’s import bill and current account deficit, increasing pressure on the domestic currency.

Analysts say uncertainty around the duration of the ongoing geopolitical tensions and supply shocks in energy markets remains a major concern for investors.

Meanwhile, global risk sentiment remained fragile. US equities declined in the previous session, while Treasury yields moved higher, reflecting investor caution.

Market participants expect the RBI to continue intervening intermittently to prevent excessive volatility in the rupee. Traders say the central bank is likely to smooth sharp moves rather than defend any specific level, a strategy that has helped the currency recover from intraday lows in recent sessions.

However, with crude prices elevated and geopolitical uncertainties persisting, the rupee may remain under pressure in the near term.

-With Reuters inputs