Rupee Hits Three-Month Low Amid Brent Crude Surge and Rising US Bond Yields

The Indian rupee has hit its weakest level in nearly three months due to rising Brent crude oil prices and increasing US bond yields. On Tuesday, the currency closed at 95.95 against the previous close of 95.55, with the Reserve Bank of India (RBI) selling dollars at weaker levels. The surge in global bond yields has put additional pressure on the rupee, which is also being driven down by high oil prices.

The RBI's dollar sales have been keeping the currency under constant pressure, and traders are now focusing on whether the central bank will continue to defend the rupee near 95.59-96 levels. A consistent move above 96 per dollar could lead to further depreciation of the rupee, potentially pushing it towards 96.10-96.20.

MUFG bank has forecasted a gradual depreciation of the rupee against other Asian currencies, predicting USD/INR at 95.50 by December 2026 and 96.50 by June 2027. The focus is now on oil prices, which will determine the trajectory of the rupee in the coming days.