The Indian rupee fell on Thursday for the first time in eight trading sessions, ending a run of gains as higher oil prices weighed on the currency.
Brent crude climbed above $112 a barrel, and that rise was a key factor behind the rupee’s decline. India is a heavy importer of oil, so a jump in crude prices tends to put pressure on its currency.
The fall came even though money was flowing into the country from foreign portfolio investors. Those inflows were linked to the Jio Platforms IPO, and they were not enough to offset the effect of dearer oil on Thursday.
Looking ahead to Friday, currency traders expect the rupee to move within a range of 94.50 to 95.25 against the US dollar. The upper end of that range sits close to a level that market participants are watching closely.
The Reserve Bank of India may step in if the currency approaches 95 per dollar. Traders see that level as a point where the central bank could act to limit further weakness, although any move would depend on how the rupee trades.
For now, the direction of oil prices and the pace of foreign inflows tied to the Jio Platforms IPO are the main forces shaping sentiment around the rupee. The currency’s winning streak has ended, and attention turns to whether Friday’s trading stays inside the range traders are expecting.