Rupee’s 7-day losing streak deepens: Sinks to record low of 96.38 as Brent stays near $110 

Surge in US yield rates, crude remaining at elevated levels and the global uncertainty is weighing on the currency. According to the currency market traders, the Reserve Bank of India may have sold dollars to support the under-pressure rupee. The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 99.10, lower by 0.09%. 

Devarsh Vakil, Head of Prime Research at HDFC Securities said that the “Indian rupee reached a fresh all-time low against the US dollar, making it one of the worst-performing currencies in Asia for the year. This depreciation is primarily attributed to rising US Treasury yields and elevated crude oil prices, which have exacerbated concerns over India’s balance of payments and imported inflation.” 

Petrol, diesel prices hiked again 

Brent crude is currently hovering near $109.80 a barrel. Due to rising crude prices, India has raised petrol and diesel prices by about 90 paise per litre on Tuesday, marking the second increase within a week. The latest hike comes just days after fuel rates were revised for the first time in more than four years. It follows a Rs 3 per litre increase announced last Friday.

Analysts expect further phased increases in petrol and diesel prices. IDFC FIRST Bank said, “Given the under-recoveries faced by OMCs, further increases in retail petrol and diesel prices are expected. We expect a cumulative rise of up to 10% in retail petrol and diesel prices (including today’s increase), spread over the next few months.”

Currency markets watch out for progress in US-Iran talks 

Investors are also weighing whether the US and ⁠Iran will ‌reach an agreement to halt the war and ​reopen the Strait of Hormuz.

According to Reuters, US President ‌Donald Trump said he had paused a planned attack on Iran to allow for negotiations, providing slight relief.