rupee: Rupee hits two-month low amid rising crude oil prices

Mumbai: The rupee on Tuesday mirrored the broader weakness in the Asian foreign-exchange market to slide to its two-month intra-day low of 86.28 per dollar, before marginally erasing losses to 86.24, as the escalating West Asian conflict caused crude oil prices to soar.

The Nymex front-month contract climbed 1.8% early evening trade to $73, while Brent Crude, the benchmark used in Europe, advanced by an equivalent amount on concerns a protracted Israel-Iran conflict would destabilise supplies and pressure oil prices through the main holiday months in both North America and Europe’s richer nations.

The rupee had closed at 86.06/$1 on Monday, LSEG data showed. Likely intervention by RBI, possibly above the 86.25/$1 levels, helped contain excess losses in the currency, traders said.
“Geopolitical uncertainties and foreign investors selling Indian stocks and bonds have added pressure on the rupee. We won’t see any appreciation until the oil prices cool,” said Anindya Banerjee, head of research, FX and interest rates, Kotak Securities.