Rupee trades lower amid elevated crude prices
New Delhi, May 15
The Indian rupee breached the 96-mark against the US dollar on Friday amid persistent global pressures, rising crude oil prices, and continued geopolitical tensions linked to the Iran conflict.
Earlier in the day, the domestic currency opened at 95.86 in the interbank foreign exchange market and slipped to 95.94 during early trade, after touching an all-time low of 95.96 in the previous session.
Pressure on the rupee also intensified after oil marketing companies (OMCs) increased petrol and diesel prices by Rs 3 per litre with immediate effect.
According to experts, the rupee has remained under pressure in recent weeks and emerged as one of the worst-performing currencies in Asia as India's import bill comes under strain from surging energy costs.
In addition, market sentiment remained fragile after talks between US President Donald Trump and Chinese President Xi Jinping failed to deliver significant progress on key geopolitical flashpoints, particularly on the US-Iran front.
Despite pressure on the rupee, domestic equity markets showed resilience.
BSE Sensex rose 0.62 per cent or 471.64 points during intraday trade, while the Nifty 50 gained 0.63 per cent or 150 points to touch 23,839.30.
On the commodities front, international benchmark Brent crude surged 3.46 per cent to $109.38 per barrel. Similarly, US West Texas Intermediate (WTI) crude advanced 4 per cent to $105.24 per barrel.
Indian oil marketing companies (OMCs) have raised petrol and diesel prices by Rs 3 per litre.
According to a senior official, the marginal increase in fuel prices is significantly lower than the losses being absorbed by public sector oil companies due to soaring global crude oil prices, which have crossed the $100-per-barrel mark.
— IANS
Reader Comments
It's interesting how the Indian stock market is shrugging off the rupee weakness. Sensex up 471 points shows that FIIs still see value in Indian equities despite currency volatility. But for a common Indian household, the pain of rising fuel prices is very real. Hope RBI manages this carefully.
Honestly, why can't our government cap petrol prices like they do in Gulf countries? We are a developing nation and every rupee counts. Rs 3 per litre increase means an extra Rs 300-400 per month for my family. And with crude at $109, more hikes are coming. This is not sustainable for the middle class. 😔
As someone who follows global macro closely, the rupee weakness is a reflection of broader USD strength and geopolitical risk premium. India's import bill is ballooning due to crude above $100. The silver lining is that domestic equities are resilient, suggesting Indian economy's fundamentals remain strong. But short-term pain is inevitable.
This is classic imported inflation. We have no control over crude prices or geopolitical tensions in Iran. But what we can control is our reliance on oil. Why isn't there more urgency in adopting electric vehicles and solar energy? We keep papering over these structural issues and then blame global events. 🤦
We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.