Indian Rupee Declines To Record Low Amid Middle-East War Tensions
(RTTNews) - The Indian rupee weakened against the U.S. dollar in the European session on Monday, as further escalation in the U.S.-Iran war spurred inflation concerns.
Benchmark Brent crude prices jumped more than 2 percent to $109 a barrel after U.S. President Donald Trump issued a 48-hour ultimatum to Iran to reopen the Strait of Hormuz, warning of strikes on power plants.
Iran said it would attack Israel's power plants and plants supplying U.S. bases in the Gulf if Trump carries out his threat to "obliterate" Iran's power network.
Since late February, Iran has effectively restricted access to the waterway, through which around 20 percent of global oil and liquefied natural gas (LNG) flows.
As the US-Israeli war with Iran hampered trade via the Strait of Hormuz, Saudi Aramco, the world's largest oil exporter, curtailed crude delivery to Asian clients for a second month in April, significantly squeezing the region's oil supply.
In order to support the currency, traders were watching for any move from the Reserve Bank of India (RBI).
In the European trading today, the rupee fell to a record low of 94.12 against the U.S. dollar, from an early high of 93.71.
The rupee may test support near the 95.00 region.
Looking ahead, U.S. Chicago Fed national activity index for February and U.S. construction spending for January are slated for release in the New York session.
At 11:00 am ET, Eurozone flash consumer confidence for March is due to be published.
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