The Indian rupee opened 2 paise weaker at 96.37 per US dollar on Tuesday, 19 May, as elevated crude oil prices continued to weigh on the domestic currency.
Pressure on the rupee intensified further amid weakness across Asian currencies, subdued global risk appetite, and elevated US bond yields.
The rupee has now fallen for seven consecutive sessions, losing around 2.2% during the period while repeatedly touching fresh record lows. Since the Iran conflict escalated in late September, the currency has declined more than 6%.
Brent crude hovered near $110 per barrel in Asian trade as investors closely tracked developments in possible negotiations between the US and Iran aimed at ending the conflict and reopening the Strait of Hormuz.
US President Donald Trump said a planned strike on Iran had been paused to allow room for negotiations, offering limited relief to global markets.
However, investor sentiment remained cautious, with US equity futures and Asian stock markets trading lower, keeping pressure on regional currencies, including the rupee.
Rupee Rout
The rupee has remained under intense pressure, declining around 1.5% so far this month and more than 7% in 2026, as investors struggle to find stability amid persistent global and domestic headwinds.
Analysts said capital flows are now driving the currency more than sentiment. Foreign investors have withdrawn nearly $2.6 billion from Indian equities recently, further accelerating the rupee’s slide. The broader trend remains equally concerning, with total net equity outflows in 2026 touching nearly $23.2 billion — already surpassing last year’s outflows of $18.9 billion.
Experts noted that sustained capital flight tends to amplify pressure on emerging-market currencies, and the rupee is currently bearing the full impact of those outflows.
As a result, the Indian currency has emerged as the weakest-performing Asian currency so far this year.
(more to come)