FX.co ★ Rupee Slips to 7-Week Low

The Indian rupee weakened to about 95.8 per dollar, hovering near a seven‑week low, as sustained gains in oil prices, higher US Treasury yields, and mounting expectations of a Federal Reserve rate hike pressured the currency. Brent crude climbed above $107 a barrel, extending its monthly rally to more than 18%, after stalled US–Iran negotiations, renewed Houthi attacks on Saudi Arabia, and fresh disruptions to energy infrastructure intensified concerns over supply shortages.

The jump in oil prices stoked inflation fears and pushed the US 10‑year Treasury yield to 5% for the first time in nearly three years, while markets now view a Fed rate increase on Wednesday as almost a foregone conclusion. At the same time, the Reserve Bank of India has repeatedly stepped in around the 95.80-per-dollar level, helping to curb further depreciation of the rupee.

Investors also weighed new economic data showing India’s inflation rate rose to 4.82% in August from 4.45% in July, its highest level since December 2024 and broadly in line with forecasts, underscoring renewed energy-driven price pressures and the impact of a weaker currency.