The Rupee: External headwinds plunge the Indian currency to Rs. 96.53/USD
Virendra Pandit
New Delhi: On the sixth consecutive day, as external headwinds continued to roil world markets, the Indian rupee plunged further to a record low of Rs.96.53 per US dollar on Tuesday.
Since the US and Israel attacked Iran on February 28, starting the poly-crises in West Asia and elsewhere, the Indian currency has fallen 6.1 percent.
The Indian rupee’s Tuesday fall to a record low for a sixth consecutive day was weighed down by mounting external pressures as the prolonged US-Iran conflict drives a sustained rise in crude oil prices and pushes US Treasury yields higher.
The rupee slumped to a record closing low of 96.5325 per dollar, compared to the 96.3450 level it settled at on Monday. It touched a record intraday low of 96.6150, the media reported.
Economists expect India’s current account deficit to widen significantly, hit by higher crude oil prices and lower remittances due to the ongoing war.
The benchmark Brent crude jumped over 50 percent since the start of the war, a major challenge for India’s economy which imports almost 90 percent of its crude oil requirement.
The merchandise trade deficit widened to USD 28.38 billion in April 2026, driven largely by a surge in crude oil imports, while April wholesale inflation accelerated to its highest level in three-and-a-half years, underscoring the pass-through of higher energy costs, the reports said.
Iran’s latest peace proposal to the United States involves ending hostilities on all fronts including Lebanon, the exit of US forces from areas close to Iran, and reparations for destruction caused by the war, terms similar to the nation’s previous offer, which US President Donald Trump rejected last week as “garbage.”
The recent surge in U.S. Treasury yields, driven by inflation concerns, is further complicating the outlook for the local currency.
The US’ 10-year Treasury yield climbed to its highest level in more than a year this week, with investors increasingly pricing in the possibility of a Federal Reserve rate hike in December.
