As oil prices continue to rise in the face of the West Asia conflict, the Indian rupee fell to a fresh low against the US dollar on Thursday, dropping 30 paise to 92. 94.
Meanwhile, over the last 12 sessions, foreign institutional investors (FIIs) have sold over Rs 74,000 crore in the home stock market.
If the US and Israel attack its energy facilities once more, Iran has threatened to launch harsher retaliation attacks. Israel attacked Iran’s South Pars offshore natural gas field in the Gulf on Wednesday, which it shares with Qatar.
Following Iranian attacks, fires and significant damage at liquefied natural gas plants were later reported by Qatar.
Due to a stronger greenback and ongoing foreign capital outflows, the rupee fell to a new low of 92. 63 against the US dollar earlier on Wednesday.
At the interbank foreign exchange, the rupee started the day at 92. 42 and traded within a limited band before falling to its record low during the session.
The currency was under intense dollar demand from importers, despite a backdrop of high risk appetite and lower crude prices. The rupee has declined by more than 1% as a result of the ongoing war in West Asia.
Analysts say that the rupee will continue to be under pressure due to the persistent high price of crude oil, which keeps the macro environment still negative.
As the White House takes steps to halt increasing prices in the wake of recent disruptions in the world supply chain, the US is contemplating a number of emergency energy measures, such as loosening restrictions on Iranian oil and releasing more crude from its strategic reserves.
In anticipation of possible bottlenecks in the world oil flow, especially in important marine routes, the administration has made contingency plans, according to Scott Bessent, the US Treasury Secretary.
The push comes at a time when the White House is under pressure to address soaring oil prices in the wake of attacks on energy infrastructure and interruptions to shipping routes.
The push comes as the White House faces pressure to respond to rising oil prices following attacks on energy infrastructure and disruptions to shipping routes.