INR weakens as elevated crude prices and stalled US-Iran talks over the Strait of Hormuz fuel supply concerns for oil-importing economies.
The Indian Rupee traded flat against the US Dollar but remained near a two-week low of 95.75 INR/USD, pressured by rising oil prices. Crude oil futures on the MCX rose 0.6% to Rs. 8,130, approaching a three-week high set earlier this week.
Oil prices stayed elevated amid stalled negotiations between the US and Iran over reopening the Strait of Hormuz, a key route for nearly 20% of global oil supply. Analysts noted that hopes for a swift resolution have faded, with both sides maintaining hardline positions on control of the shipping lane.
Currencies of oil-dependent economies like India typically weaken in high-oil-price environments. Disruptions in the Strait of Hormuz and recent attacks near the region have heightened supply risks, keeping markets on edge.