- Indian currency, the rupee, hits its lowest point in a year at 83.28 against the USD.

The Indian rupee has reached a 1-year low at 83.28 against the US dollar due to mounting concerns over oil prices and the escalating conflict in the Middle East. This decline is significant as it is the lowest point the rupee has reached in a year. The Reserve Bank of India has been actively intervening to prevent further decline towards the all-time low and has reportedly sold US dollars earlier in the trading session. However, the volatility in the price of oil and the geopolitical tensions in the Middle East continue to pose risks to the value of the rupee.

The fall in the rupee is primarily attributed to the concerns surrounding oil prices. Last week, there was a surge in oil prices, and although they remained relatively stable on Monday, market participants are closely monitoring the Israel-Hamas conflict, anticipating the involvement of additional nations. This conflict presents a geopolitical risk to the oil market, similar to Russia's invasion of Ukraine last year. The potential escalation of the conflict and its impact on oil-producing regions, including Saudi Arabia, Iran, and the United Arab Emirates, could further elevate oil prices and pose new challenges to the global economy.

The Reserve Bank of India's intervention in the currency market is designed to prevent a further decline in the rupee. It is believed that the central bank has sold US dollars to support the rupee's value. The Reserve Bank of India's proactive measures aim to stabilize the currency and mitigate the impact of external factors such as oil prices and geopolitical tensions. Despite these interventions, the volatility in the currency markets and the uncertainties surrounding the global economy continue to pose challenges for the rupee.

In conclusion, the Indian currency has hit a 1-year low against the US dollar due to concerns about oil prices and the escalating conflict in the Middle East. The Reserve Bank of India is actively intervening to prevent further decline and stabilize the rupee. However, the volatility in oil prices and geopolitical tensions pose ongoing risks to the value of the rupee. Market participants will closely monitor these developments to assess their impact on the global economy and the currency markets.