The currency opened at 94.92 in the interbank forex market before retreating to 94.98. This decline extends the previous week’s momentum, which saw the rupee lose 12 paise on Friday, closing at 94.93 and marking its second consecutive session of declines.
Market participants highlighted that ongoing uncertainty surrounding the Middle East conflict continues to weigh heavily on the local currency. Additionally, elevated oil prices and potential selling by foreign investors remain key downside risks, although a weaker dollar and possible intervention by the Reserve Bank of India (RBI) could provide a safety net.
Anuj Choudhary, a research analyst at Mirae Asset Sharekhan, commented, “The Indian rupee opened slightly lower, driven by elevated crude oil prices and persistent geopolitical tensions in the Middle East. However, softness in the US Dollar and US treasury yields cushioned the downside.”
Looking ahead, Choudhary added, “We expect the rupee to trade with a slight negative bias due to risk aversion in global markets amid the escalation of tensions in the Middle East. Elevated crude oil prices and selling pressure by FIIs may also pressurise the rupee. However, weak US Dollar and any fresh intervention by the RBI may support the rupee at lower levels.”
Meanwhile, the dollar index, which tracks the US currency against a basket of six major currencies, fell 0.15% to 101.49. Despite this dip, the rupee’s decline could not be fully arrested.
In commodity markets, Brent crude, the global oil benchmark, rose significantly by 1.92% to trade at $114.48 per barrel.
On the domestic equity front, Dalal Street also opened lower, with the Sensex falling 536.30 points to 72,583.86 and the Nifty declining 200.10 points to 22,402.80. According to exchange data, foreign institutional investors (FIIs) had bought Indian shares worth Rs 887.65 crore last Friday.
Separately, India’s foreign exchange reserves fell by $5.011 billion to $721.016 billion for the week ended October 16, according to Reserve Bank of India data released on Friday. This followed a larger decline of $8.578 billion in the previous week, when reserves had stood at $726.027 billion.
