FX.co ★ Rupee Falls on Outflows, Trump Speech

The Indian rupee slipped to around 93.2 per dollar, extending its decline for another session amid ongoing capital outflows and escalating geopolitical tensions. The currency has come under sustained pressure from spillover effects of the war in Iran, prompting the Reserve Bank of India to intensify efforts to curb arbitrage and manipulation in the forwards market.

After an earlier crackdown on banks failed to stabilize volatility, authorities moved to prohibit corporates from rebooking cancelled foreign exchange contracts and imposed tighter restrictions on derivative transactions with related parties. Analysts observed that, although these measures are designed to rein in speculative behavior, the rupee remains exposed as elevated oil prices persist and capital inflows stay weak.

Sentiment was further weighed down by President Donald Trump’s 20-minute prime-time address, in which he said the United States is “very close” to achieving its military objectives in Iran, while simultaneously warning of the risk of further escalation.