Rupee hits record low past 94/USD as prospect of prolonged Iran war deepens energy risks

MUMBAI : The Indian rupee hit a record low past the 94-per-dollar ​mark on Friday, hammered by ‌worries that the energy supply crisis sparked by the Middle East war will drag on, deepening the pressure on ​energy importing economies.
The rupee fell ​to 94.1575 per dollar, eclipsing its ⁠previous all-time low of 93.98 ​hit earlier this week. It has declined about 3.5% ​since the war began late last month.

The threat of a protracted energy shock ​has kept oil prices above the $100-per-barrel ​mark, weighing on global equities and sending bond yields ‌higher.

Analysts ⁠have shaved growth forecasts for India, with some also anticipating rate hikes by the Reserve Bank ​of India ​over ⁠the next 12 months as the spillovers from ​the crisis threaten to ​lift ⁠inflation. Even if a lengthy conflict is avoided, Bernstein sees a realistic ⁠chance ​of the rupee breaching the 98-per-dollar level this ​year, with pressure primarily stemming from India’s ​current account balance.

Source : Reuters