Rupee battered in the shadow of war! Record fall against dollar, will petrol and diesel become more expensive now?

US Dollar vs Indian Rupees: Against the dollar, the rupee broke the level of 92.50 for the first time on Wednesday and reached a new all-time low of 92.634. This is the first time that the rupee has reached this level against the dollar. Earlier, the all time low of rupee against the American currency was 92.4750. The rupee opened the session with a weakness of 3 paise at 92.402 against the dollar. Its decline increased during the day and it reached 92.634. The rupee touched a low of 92.334 and a high of 92.643 against the dollar during the day.

The weakness in the rupee against the dollar is being attributed to the conflict in the Middle East. Due to the Iran war, the price of crude oil has crossed $ 100 per barrel, because India imports more than 80 percent of its requirement of crude oil from abroad. In such a situation, due to increase in the price of crude oil, pressure on the rupee is increasing.

50% rise in crude oil prices

Crude oil has seen a rise of more than 50 percent in the last one month. Brent crude is at $103 per barrel and WTI crude at $94 per barrel. Jatin Trivedi of LKP Securities said the rupee has slipped below 92.60, its lowest level ever, due to the pressure of continuous increase in import bill. There is growing concern about a continued rise in import costs for India due to high crude oil prices and the ongoing blockage in cargo movement through the Strait of Hormuz. He further said that the macroeconomic outlook remains unfavorable, with crude oil prices likely to remain high for a longer period, which will keep pressure on the rupee.

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Rupee will remain weak against dollar

Market participants are now closely keeping a close eye on today’s policy decision of the US Federal Reserve, which will play a key role in deciding the direction of the dollar and consequently impact the rupee movements. In the near future, Rupee against US dollar Expected to remain in the weak range of 92.25-92.95.