Top News

Indian rupee hits all-time low of 95.58 against US dollar
12 May 2026

The Indian rupee has hit a new all-time low, falling to 95.58 against the US dollar on Tuesday.

The depreciation comes amid rising crude oil prices and escalating tensions related to US-Iran, which have rattled financial markets and increased pressure on India's external balances.

The fall follows a steep single-day decline yesterday when the currency closed at a then-record low of 95.31 per dollar.

Rupee's fall attributed to rising crude oil prices
Market factors

Currency traders and analysts have attributed the rupee's fall to soaring crude oil prices, heavy dollar demand from importers, and continued foreign fund outflows from Indian markets.

Brent crude prices have spiked sharply since the US-Iran conflict escalated earlier this year, worsening concerns over India's import bill and current account deficit.

India imports over 85% of its crude oil requirements, making the rupee particularly vulnerable to global energy price fluctuations.

US-Iran ceasefire fears add to currency pressure
Geopolitical impact

The latest weakness in the rupee also comes amid fears that the fragile US-Iran ceasefire could collapse.

President Donald Trump recently described the April ceasefire as being "on life support," raising fears of prolonged disruption in the Gulf region and further volatility in oil markets.

These geopolitical developments have added to the pressure on India's currency.

RBI intervenes in forex market to slow down rupee's fall
Regulatory measures

Traders believe that the Reserve Bank of India (RBI) has intervened in the forex market several times over the past few sessions to slow down the rupee's fall.

State-run banks were also reported to be selling dollars on behalf of the RBI after a sharp fall in the currency during trade.

The central bank has been using a combination of intervention measures in recent weeks, including stricter forex market regulations and measures aimed at reducing dollar demand from oil companies.

Rupee's fall raises inflation concerns in India
Economic implications

The rupee's fall has also affected investor sentiment across Indian financial markets.

Benchmark stock indices fell sharply on Tuesday as rising oil prices raised concerns over inflation, fiscal pressures, and slowing growth.

Economists warn that a weaker rupee could lead to higher imported inflation in India if crude oil prices remain high for an extended period.

This could further increase pressure on fuel prices, transportation costs, food prices, and several imported goods.