Rupee's Record Low: Impact of Surging Crude Prices and Global Unrest

The rupee has reached an unprecedented low, trading at 95.80 against the US dollar, in its fourth consecutive session of decline on Wednesday. The ongoing crisis in West Asia has exacerbated fears of prolonged global trade disruptions, driven by surging crude oil prices.

Despite the government's efforts to curb overseas purchases by raising import duties on gold and silver from 6% to 15%, the demand for the US dollar remains high as a safe-haven currency. The rupee's decline was marked throughout the day's trading session, and is projected to fluctuate between Rs 95.45 and Rs 96.15 due to ongoing market pressures.

Forex analysts attribute the rupee's record dip to rising inflation and unresolved tensions between the US and Iran, sparking risk aversion in global markets. Concurrently, the domestic markets saw mixed trading, with notable foreign investor outflows. Retail inflation rose to 3.48% in April, primarily driven by the increased costs of gold, silver, and select food items.

(With inputs from agencies.)