Rupee Slumps to 95.68 Against Dollar Amid Rising Oil Prices

The Indian rupee depreciated to 95.68 against the U.S. dollar in early trade on August 18, down 7 paise from its previous close. The decline was attributed to elevated crude oil prices and persistent demand for the greenback.

Forex traders pointed out that Brent crude near $91 per barrel increased oil-related dollar demand, while the Reserve Bank's closure of the concessional FCN (B) forex-swap facility raised concerns over future dollar inflows.

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, noted that the rupee looks vulnerable to rising oil prices. He stated, 'Rupee looks vulnerable to the rising oil prices which have remained close to $90 and have now risen above $91 per barrel. RBI was protecting near 95.61 on Monday and may be protecting 95.75 today but will allow the depreciation to continue in view of the rising oil prices and consistent demand from oil companies.'

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 99.63, down 0.01%. Brent crude was trading higher by 0.52% at $91.34 per barrel in futures trade.