Rising Oil Prices Weigh on Indian Rupee Despite RBI Support

The Indian Rupee (INR) has shown some resilience against the US Dollar (USD), but experts warn that it will remain under pressure due to elevated oil prices. The USD/INR pair has ticked lower to near 95.70 as the RBI's intervention in the spot and Non-Deliverable Forwards (NDFs) market may be curbing gains.

However, this support from the central bank is likely to be short-lived as global energy prices remain high due to the prolonged closure of the Strait of Hormuz. The MCX Crude Oil contract expiring on September 21 has fallen by 1.6% to near Rs. 8,000.

The US Treasury Secretary Scott Bessent warned that the US will pursue a 'zero leakage' approach to enforcing its sanctions on Iran, which could lead to higher oil prices and strengthen the USD.