Rupee Slumps as Oil Prices Soar on Fading Hopes for US-Iran Deal

The Indian rupee has retreated to its lowest level in nearly two weeks due to rising oil prices, which have surged on fading hopes for a US-Iran deal. Oil prices jumped as Brent crude futures reached $89.9 per barrel, up nearly 2.5%.

India imports around 90% of its crude requirements, making it vulnerable to fluctuations in global oil prices. The Reserve Bank of India (RBI) intervened to limit the rupee's losses through dollar selling, helping it close at 95.4350 per dollar, down 0.15% from the previous day.

The central bank's frequent interventions have kept volatility expectations on the dollar-rupee pair in check, despite renewed concerns about conflict in the Middle East. Analysts expect the rupee to hover around 95.80 if oil prices continue to rise, but note that RBI intervention is likely to prevent sharp moves.

In a separate development, traders are keeping an eye on consumer inflation data for India and the US, which will be released on Wednesday. The data could have significant implications for the rupee's value and overall market sentiment.