Rupee breaches 95/USD mark, settles at 94.78 amid global tensions

The Indian rupee breached the 95-per-dollar mark in intra-day trade on Monday, settling at 94.78 against the US dollar, as escalating tensions in West Asia jolted global markets and fueled currency volatility. Forex traders reported sharp swings in the USD/INR pair, which moved 165 paise during the day, reflecting heightened risk-off sentiment.

The rupee opened at 93.62 in the interbank market and initially strengthened to 93.57 after the Reserve Bank of India reduced the net open position (NOP-INR) that banks can hold overnight to USD 100 million . However, the momentum could not be sustained, and the rupee plunged to an intra-day low of 95.22 before closing at 94.78 , just 7 paise above Friday’s historic low of 94.85 .

“Global uncertainties are at the core of this weakness. Hopes of de-escalation between the US and Iran faded, prompting a shift towards safer assets, strengthening the dollar and weakening emerging market currencies like the rupee,” said Amit Pabari, MD of CR Forex Advisors. Traders added that the firm dollar index and rising crude oil prices were further pressuring the currency. Brent crude futures surged 2.6% to USD 114.97 per barrel on concerns of supply disruptions.

The domestic equity market also felt the heat, with the Sensex plunging 1,635.67 points to 71,947.55 and the Nifty falling 488.20 points to 22,331.40. Foreign institutional investors sold equities worth Rs 4,367.30 crore on a net basis on Friday.

Responding to concerns over the rupee’s depreciation, Finance Minister Nirmala Sitharaman emphasized that India’s economic fundamentals remain strong. “Compared to other emerging market economies, the Indian rupee is absolutely going fine ,” she said, highlighting solid fiscal management, strong forex reserves, and stable inflation. She noted that the rupee’s recent decline is in line with movements in other Asian currencies such as the South Korean won, Thai baht, and Philippine peso, which have depreciated even more against the dollar.

Minister of State for Finance Pankaj Chaudhary added that the rupee is market-determined and influenced by multiple factors, assuring that both the government and RBI are closely monitoring its value. Since the West Asia conflict began on February 28, 2026, the rupee has depreciated about 4.1% against the US dollar.