The Indian rupee snapped an eight-session-long winning streak on Thursday as Brent oil prices climbed to their highest since May on deepening worries about conflict in the Middle East, which hammered global equities as well.
The South Asian currency endured a volatile trading session, swinging from its strongest level in over six weeks to close down 0.4% at 94.8175 per dollar.
Earlier in the day, chunky foreign inflows for Jio Platforms’ IPO added to tailwinds from the Reserve Bank of India’s defensive measures that had boosted the currency but its gains faded as oil prices climbed in the latter half.
Traders pointed to broad-based dollar demand locally alongside broader signs of a risk-off move in global markets.
MSCI’s All-World index was set for its largest daily fall in two weeks, down 0.4%, as tech shares from Seoul and Tokyo to Amsterdam and Paris came under pressure. Equity futures pointed to a weak start for shares on Wall Street as well.
OIL PRICES REMAIN A KEY RISK
Oil prices have remained elevated despite oil flows from the Gulf holding up, reflecting market anxieties over the conflict.
“The sizeable risk premium currently embedded in prices is unlikely to fade until clear signs of de-escalation emerge and reassure investors that regional supply will remain uninterrupted,” ING said in a note. Brent oil prices were last up 3.3% at $112.40 per barrel.
India imports nearly 90% of its crude requirements, making it one of the world’s most vulnerable economies to the Middle East oil shock. This remains a key risk for the rupee, with market participants and observers split over how sternly the RBI should defend the currency in the face of fundamental pressures.
While senior IMF official Krishna Srinivasan said on Wednesday that India should allow the dollar-rupee exchange rate to move as the first line of defence, former RBI deputy governor Michael Debabrata Patra told Reuters that exchange rates tend to overshoot and can cause financial stability risks.
Published on October 22, 2026
