The Indian Rupee fell 2 paise to close at a record low of 95.25 (provisional) against the US Dollar on Tuesday, pressured by rising geopolitical tensions in the Gulf and elevated crude oil prices.
Forex traders said renewed clashes near the Strait of Hormuz and attacks on infrastructure in the United Arab Emirates have triggered risk aversion, prompting investors to move away from emerging market assets.
At the interbank forex market, the rupee opened at 95.30 and slipped to an intraday low of 95.44 before settling at its weakest-ever closing level. The currency had already hit a previous record low of 95.23 in the prior session.
Analysts pointed to crude prices as a key pressure point, with Brent Crude hovering near USD 110 per barrel, weighing heavily on oil-importing economies like India. Persistent foreign fund outflows and geopolitical uncertainty further dampened sentiment.
Market participants said the Reserve Bank of India may intervene to limit volatility, with the USD/INR expected to trade within a narrow range in the near term.
On the domestic equities front, the BSE Sensex fell 251.61 points to 77,017.79, while the Nifty 50 declined 86.50 points to 24,032.80.
