The Indian rupee fell to a record low on Monday, as an escalating Middle East conflict stoked worries over sustained disruption of energy supplies, threatening the outlook for Asia’s third-largest economy.
The rupee fell to 93.84 against the U.S. dollar, eclipsing its previous low of 93.7350 hit on Friday.
Asian currencies were down between 0.1% to 0.8% as hopes for an off-ramp to hostilities dimmed over the weekend with Washington and Tehran trading threats as the war entered its fourth week.
The conflict has boosted oil prices by over 50% this month. The International Energy Agency has said the crisis is worse than the two oil shocks of the 1970s put together.
The rupee, among the currencies most exposed to sustained oil price increases, has weakened about 3% since the war began.
BofA Global Research expects the rupee to trade at 94 by June 2026, versus its forecast of 89 earlier, assuming that the ongoing crisis resolves in a few weeks.
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