Rupee hits record low past 94/US dollar as prospect of prolonged Iran war deepens energy risks

The rupee fell to ​94.1575 per dollar, ⁠eclipsing its previous all-time low of 93.98 hit earlier this week. It has declined about ⁠3.5% since the war began late last month.

Mumbai: The rupee hit a record low past the 94-per-dollar mark on ⁠Friday, hammered by worries that the energy ⁠supply crisis sparked ‌by the ​Middle East war will drag on, deepening the pressure on energy importing economies.

The rupee fell to ​94.1575 per dollar, ⁠eclipsing its previous all-time low of 93.98 hit earlier this week. It has declined about ⁠3.5 per cent since the war began late last month.

The threat ‌of a protracted energy shock ⁠has kept oil prices above the $100-per-barrel mark, weighing ‌on global equities ‌and sending bond yields higher.

Analysts have ‌shaved growth forecasts for ‌India, with some also anticipating rate hikes by the Reserve Bank of ⁠India ⁠over the next 12 months as the spillovers from the crisis threaten to lift inflation.

Even if a lengthy conflict is avoided, Bernstein sees a realistic ​chance of the rupee ​breaching the 98-per-dollar level this ​year, with pressure primarily stemming from ​India's current account balance.