The Indian rupee fell 20 paise to 93.73 against the US dollar in early trade on Tuesday. Despite a five-day pause in potential US strikes on Iran, uncertainty over negotiations and heavy foreign fund outflows kept the currency under pressure
-1774331808261_d.png "Rupee slips to 93.73 against dollar as crude prices rise amid Iran uncertainty")
Rupee slips despite Trump announcing pause in strikes on Iran. Representational Image
The Indian rupee started Tuesday’s trading at 93.66 per US dollar before slipping to 93.73, down 20 paise from Monday’s close. The local unit had hit a record low of 93.98 against the greenback in the previous session, the PTI reported.
Analysts attributed the weakness to rising crude oil prices and ongoing tensions in West Asia.
Why exactly is Rupee crashing?
Crude oil and FII outflows weigh heavily on rupee. Rising global crude oil prices, a key concern for India as a net importer, added further pressure on the currency. The more the demand for USD, the more rupee crashes.
Brent crude futures were trading at USD 103.9 per barrel. Analysts warn that sustained high oil prices may increase inflation and widen India’s import bill, negatively affecting growth projections, the news agency reported.
Heavy foreign institutional investor (FII) outflows also contributed to the rupee’s weakness, with equities sold worth Rs 10,414 crore on Monday as per exchange data. Meanwhile, domestic markets showed resilience, with the Sensex rising 829 points to 73,525 and the Nifty up 234 points to 22,747 in the morning session.
US-Iran talks create mixed signals
The rupee’s movement followed US President Donald Trump’s announcement that the United States had held “productive conversations” with Iran and would pause planned strikes on Iranian power plants and energy infrastructure for five days. Trump claimed Iran was eager to negotiate and had additional time to reopen the Strait of Hormuz.
However, Iran denied that any formal talks had taken place. Mohammad-Bagher Ghalibaf, Iran’s parliamentary speaker, called the reports “fake news,” creating uncertainty that kept crude oil prices elevated and pressured the rupee.
Analysts caution on near-term trends
Experts expect the rupee to trade in a weak range of 93.25–94.25 until further clarity emerges on geopolitical tensions and energy prices. Jateen Trivedi, VP Research at LKP Securities, said currency weakness is likely to persist as long as the macroeconomic backdrop remains fragile as per IANS reports.
Anil Kumar Bhansali from Finrex Treasury Advisors noted that the rupee briefly recovered after Trump’s announcement but remains vulnerable due to oil price pressures and market uncertainty as per PTI.
(With PTI and IANS Inputs)
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