Indian Rupee Plummets to Record Low Amid Energy Concerns
Rupee hits record low of 95.85/USD as energy risk worries deepen
The Economic TimesImage: The Economic Times
The Indian rupee has reached a record low of 95.85 per U.S. dollar, driven by high oil prices and foreign portfolio outflows. This decline highlights India's vulnerability due to its heavy reliance on oil imports, which account for about 90% of its needs.
- 01The rupee fell to an all-time low of 95.85 per U.S. dollar.
- 02This marks a 1.4% decline for the week.
- 03The previous record low was 95.7950 per dollar.
- 04High oil prices and foreign outflows are straining India's economy.
- 05India imports about 90% of its oil and 50% of its gas.
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On Thursday, the Indian rupee dropped to a record low of 95.85 per U.S. dollar, surpassing its previous low of 95.7950. This decline of 0.1% reflects ongoing pressures from elevated oil prices and significant foreign portfolio outflows, which have strained both the current and capital accounts of India's economy. Over the past week, the rupee has fallen 1.4%, marking a troubling trend as it hit record lows in each trading session from Tuesday to Thursday. India's heavy dependence on oil imports, accounting for approximately 90% of its needs, makes the currency particularly susceptible to fluctuations, especially with ongoing geopolitical tensions affecting oil supply, such as the conflict in Iran.
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The depreciation of the rupee could lead to increased costs for imported goods, affecting fuel prices and potentially raising inflation rates in India.
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