The Indian rupee opened lower at 96.63 per US dollar on Friday (July 24), declining 6 paise from Thursday's settlement of 96.57 against the American currency. According to Moneycontrol, this represents a further depreciation from the previous session's 96.50/$ level as escalating tensions between the United States and Iran pushed crude oil prices higher. The rupee's latest weakness comes despite high crude prices and a bearish turn in derivative market positioning supporting demand for the dollar. As per Finrex, the Indian rupee is expected to open near its all-time low of 96.96 per dollar, weighed down by Brent crude crossing $100 a barrel, a dollar index at 101.38, and US 10-year Treasury yields rising to 4.704%. The currency had gained 20 paise in the previous session, closing at 96.24/$ after touching its best level in two weeks, but the recovery was supported by dollar inflows following RBI measures to support the rupee.
Brent crude prices surged above $100 per barrel on Thursday, marking the first move past this level in nearly two months, with oil prices climbing about 7% amid concerns over supply disruptions in West Asia. According to Moneycontrol, the latest rally followed reports that Yemen's Houthi rebels attacked two Saudi oil tankers in the Red Sea, adding to existing concerns over disruptions to shipping through the Strait of Hormuz, a key global oil transit route. This represents a significant reversal from just a few weeks ago when Brent crude was trading near $70 per barrel, helping the rupee recover towards the 94-per-dollar mark and improving expectations for the currency. Crude oil comprises over two-thirds of India's import bill, with higher prices straining the country's forex reserves and increasing demand for US dollars by oil marketing companies.
Market participants expect the Reserve Bank of India (RBI) to continue intervening in the foreign exchange market to limit excessive volatility, with the central bank having been actively selling dollars in recent sessions to cushion the rupee against oil-driven pressures. According to Moneycontrol, RBI intervention could limit further downside in the domestic currency, though the rupee remains close to its record low of 96.96 per dollar, touched on May 20, 2026. Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP, noted that the central bank appears to be allowing gradual adjustments while preventing disorderly moves. The recovery in the rupee came under pressure as rising geopolitical risks have also pushed up US Treasury yields, with the 10-year US Treasury yield rising to 4.704%, its highest level in two months, making dollar assets more attractive. The dollar index was trading at 101.38, down 0.01%, as the latest escalation in the US-Iran conflict has increased demand for the US dollar as a safe-haven currency.
Most Asian currencies were weaker against the US dollar on Friday, with the South Korean won leading gains by rising 0.634%, while the Japanese yen and Thai baht edged up 0.024% and 0.021%, respectively. According to Moneycontrol, the Taiwan dollar was the biggest loser, falling 0.139%, followed by the Philippine peso (-0.128%), Malaysian ringgit (-0.127%), Indonesian rupiah (-0.106%), Chinese renminbi (-0.024%), and Singapore dollar (-0.008%). Exporters are advised to sell dollars on any intraday rupee weakness, while importers may continue buying on dollar dips, supported by expected RBI intervention, as per Finrex. The mixed Asian performance reflects broader dollar strength driven by a spike in oil prices and a renewed global trade war raising the stakes for inflation, with the dollar riding higher on U.S. Treasury yields and hovering near a 40-year peak against the yen.
The rupee's near-term direction will likely depend on whether crude oil prices remain elevated and how geopolitical tensions evolve, according to Moneycontrol. Alongside oil prices, foreign portfolio flows and any RBI intervention will remain key factors influencing the currency in the coming sessions. India is the world's third-largest importer of crude oil, making the economy highly sensitive to fluctuations in global oil prices, with a rise in crude prices increasing India's import bill and leading to higher demand for US dollars by oil marketing companies. This can widen the trade deficit and put downward pressure on the rupee, reversing the favourable trend seen just a few weeks ago when Brent crude was near $70 per barrel.
