Rupee Slumps as Oil Prices Surge

The Indian Rupee extended its losing streak against the US Dollar for the third consecutive trading day on Thursday, with the USD/INR pair reaching a fresh 10-day high of 95.31.

This comes as oil prices continue to rise, driven by ongoing conflict risks in the region. The MCX Crude Oil contract expiring on September 21 was up 0.5% at Rs. 9,189, nearing its three-month high.

Currencies from economies reliant on oil imports tend to underperform in a high-oil-price environment, making the Indian Rupee particularly vulnerable.

The Reserve Bank of India (RBI) has been actively intervening in spot and Non-Deliverable Forward markets to support the currency against excessive depreciating moves. However, this support has only provided limited relief so far.