Rupee Breaches 93 Against U.S. Dollar For First Time Amid Oil Surge And FII Outflows

The Indian rupee weakened past the 93 level for the first time on March 20, touching a record low of 93.24 against the U.S. dollar, compared to its previous low of 92.63 recorded on March 18, as per market data.

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At the interbank foreign exchange market, the rupee opened at 92.92 and later declined to 93.08, marking a fall of 19 paise from the previous close. The currency has depreciated nearly 2% since the start of the ongoing conflict in West Asia, according to Reuters.

Oil Price Surge Impacts Currency

The decline in the rupee follows a sharp rise in global crude oil prices after attacks on key energy infrastructure in the Gulf region. Brent crude rose to $119.13 per barrel on March 19 before easing to around $107 per barrel on March 20, according to Reuters.

India is a net importer of more than 80% of its crude oil requirements, as per data from the Ministry of Commerce and Industry, and hence its currency is vulnerable to changes in oil prices globally.

Foreign Outflows Continue

Foreign institutional investors continue selling stocks in India; in March, they sold more than $8 billion in Indian stocks, which is the highest since January 2025, as per Reuters.

Exchange data showed that foreign investors sold shares worth ₹7,558.19 crore on a net basis on March 19, adding pressure on the rupee.

Global Developments And Policy Signals

The U.S. Federal Reserve has kept its interest rates in the 3.5-3.75% range, as per its official announcements, and has indicated a high inflation trend. These factors have kept the dollar strong in the wake of geopolitical tensions.

Global efforts to stabilise energy supply routes have also been reported, with multiple countries exploring measures to secure shipping through key oil transit routes, according to Reuters.

Domestic Market Movement

Indian equity benchmarks recovered on March 20, with the Sensex rising 960.67 points, or 1.29%, to 75,167.91, while the Nifty 50 gained 311.50 points, or 1.35%, to 23,313.65.

The rupee’s movement reflects the combined impact of rising global oil prices, foreign capital outflows, and ongoing geopolitical developments, which have pushed the currency to a new record low against the U.S. dollar.