Rupee Plunges to 92.49/USD as Oil Nears $100, FIIs Flee

Currency experts told ANI that the rupee is likely to remain under pressure until there are clear signs of de-escalation in the ongoing geopolitical crisis, which has pushed global oil prices higher and strengthened the US dollar.

They noted that the Reserve Bank of India (RBI) has been intervening in the foreign exchange market to slow the fall of the rupee and prevent excessive volatility. However, experts cautioned that there is a limit to how much the central bank can intervene in the market.

K N Dey, a currency expert, told ANI that the rupee opened at 92.34/35 on Friday, reflecting continuing pressure due to rising crude prices.

"Rupee opened today at 92.34/35 showing signs of continuing pressure on Brent again around 100 with chances of further going up, Highly volatile with either side movement of 7 to 8 per cent intraday. Highly speculative zone," he said.

Dey also highlighted significant foreign investor outflows from Indian equities this month, which have further weighed on the rupee.

"FII's have Net sold equities this month only in 8 trading days Rs. 46,000 crores roughly equal to US $ 5 billion going out. Huge outflows. Most of the Asian currencies have fallen. (Russian Ruble has gained)," he added.

He further pointed to concerns related to breakdown of supply chain management and the possibility of stop loss triggers in dollar-rupee positions. According to him, the previous day's high of the dollar-rupee pair in the non-deliverable forward (NDF) market stood at 92.49/50.

Dey noted that RBI intervention mainly works as a "speed breaker" in the market rather than reversing the trend.

"The intervention acts only as a Speed Breaker. Dollar demand may also arise on account of Balance Sheet management. It's extremely impossible to say how far the Rupee's fall will extend," he said.

Meanwhile, Ponmudi R, CEO of Enrich Money, said the USD/INR pair is currently trading near the 92.00-92.50 range, indicating sustained pressure on the rupee.

"The USD/INR pair is trading near the 92.00-92.50 range, reflecting continued pressure on the Indian rupee. Rising crude oil prices and safe-haven demand for the US dollar amid geopolitical uncertainty have placed emerging market currencies under pressure," he said.

Ponmudi further noted that the technical chart structure for the currency pair remains bullish, indicating continued upward movement in the dollar.

"The chart structure remains bullish with a clear pattern of higher highs and higher lows," he added.

- ANI