On Thursday, the Indian rupee fell to a new record low of 95.34 per dollar, driven by a surge in crude oil prices that reached $126 per barrel amid ongoing geopolitical tensions. The yield on the benchmark 10-year government bond also rose, hitting 7.07% during the day. The Reserve Bank of India's (RBI) latest data revealed a net short position in the forward market exceeding $100 billion, adding pressure to the rupee. Analysts, including Abhishek Goenka, noted that the correlation between crude oil prices and the rupee is strengthening, suggesting that the rupee's decline reflects broader macroeconomic risks. The rupee has depreciated 5.31% against the dollar in 2026 so far, with experts warning that without significant capital inflows, the currency will continue to struggle. The RBI's ability to stabilize the rupee through dollar sales is limited due to its large forward book, which has fallen to below nine months of import cover, indicating a precarious position against external shocks.