{"id":439687,"date":"2026-10-08T18:45:48","date_gmt":"2026-10-08T11:45:48","guid":{"rendered":"https:\/\/www.swingfish.trade\/blog\/market-news\/the-indian-rupee-collapses-to-new-record-lows-as-surging-oil-prices-outweigh-rbi-rate-hikes-439687\/"},"modified":"2026-10-08T18:45:48","modified_gmt":"2026-10-08T11:45:48","slug":"the-indian-rupee-collapses-to-new-record-lows-as-surging-oil-prices-outweigh-rbi-rate-hikes","status":"publish","type":"post","link":"https:\/\/www.swingfish.trade\/blog\/market-news\/the-indian-rupee-collapses-to-new-record-lows-as-surging-oil-prices-outweigh-rbi-rate-hikes-439687\/","title":{"rendered":"The Indian rupee collapses to new record lows as surging oil prices outweigh RBI rate hikes"},"content":{"rendered":"
\n

FUNDAMENTAL
\n OVERVIEW<\/p>\n

\u00a0<\/p>\n

USD:<\/p>\n

The US dollar has
\n been supported recently despite a dovish repricing triggered by Fed\u2019s Williams
\n and Fed\u2019s Jefferson comments that pushed back against expectations of a rate
\n hike in October. <\/p>\n

The main reason was
\n surging Treasury yields and risk-off flows into the greenback supported also by
\n European debt concerns. The focus has been particularly on France, where
\n political uncertainty and concerns over the country’s large fiscal deficit have
\n pushed French government bond yields higher and widened the spread over German
\n Bunds to its highest level since the eurozone debt crisis. <\/p>\n

A stabilization in
\n French spreads could allow some of the euro’s risk premium to unwind and
\n trigger a pullback in the US dollar, while further widening and contagion to
\n other countries would likely keep the greenback supported.<\/p>\n

Moreover, the recent
\n US-Iran \u201cceasefire\u201d seems to be coming to an end as Trump is weighing new
\n strikes against Iranian targets before the November elections. The reports
\n triggered a surge in oil prices and worsened the risk sentiment further.<\/p>\n

In the short term,
\n a de-escalation will likely trigger a pullback in US dollar longs, while a prolonged
\n stalemate or a direct US-Iran confrontation should keep supporting the
\n greenback into new highs.<\/p>\n

\u00a0<\/p>\n

INR:<\/p>\n

On the INR side, the
\n rupee has come under renewed pressure, falling into new record lows against the
\n US dollar despite the RBI delivering a rate hike on Wednesday and shifting its
\n stance to \u201ccalibrated tightening\u201d.<\/p>\n

The move was
\n accompanied by signals that further hikes could follow, but the additional
\n policy support has so far failed to offset strong dollar demand, foreign
\n portfolio outflows and the broader deterioration in the external backdrop. <\/p>\n

The main driver continues
\n to be oil. India is heavily dependent on imported crude, meaning higher oil
\n prices require Indian importers to buy more dollars to pay for energy,
\n increasing demand for USD and worsening the country’s trade and current-account
\n position. The latest surge in crude oil driven by renewed US-Iran escalation,
\n is therefore negative for the rupee. <\/p>\n

Monetary
\n tightening can support the currency through higher domestic yields, but when
\n the oil shock is large enough, the resulting increase in dollar demand can
\n overwhelm that effect. As long as oil prices remain elevated, the rupee is
\n likely to remain under pressure, leaving the RBI facing the difficult task of
\n tightening policy while simultaneously using its foreign-exchange reserves to
\n smooth the currency’s decline. <\/p>\n

In the short-term,
\n a de-escalation could trigger a relief rally in the rupee as oil prices will
\n likely fall. A prolonged stalemate or direct US-Iran confrontation, on the
\n other hand, will continue weigh on the currency. \u00a0<\/p>\n

In the big
\n picture, the Indian Rupee remains on a bearish structural trend against the US dollar,
\n so dip-buyers will continue to look for opportunities around strong major technical
\n levels to keep pushing the USD\/INR pair into new highs. <\/p>\n

\u00a0<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 DAILY TIMEFRAME<\/p>\n<\/p>\n

On the daily
\n chart, we can see that USDINR<\/a>is breaking above the all-time high as surging oil prices are
\n sending the Indian rupee to new lows. If the price falls back below the
\n all-time high, we can expect the sellers to step in, with a defined risk above
\n the high, to position for a correction into the 96.10 support. The buyers, on
\n the other hand, will continue to pile in for new record highs as long as the
\n price stays above the all-time high.<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 4 HOUR TIMEFRAME<\/p>\n<\/p>\n

On the 4 hour
\n chart, we have an upward trendline defining the bullish momentum. If we get a
\n pullback, the buyers will likely lean on the trendline, with a defined risk
\n below it, to keep targeting new record highs. The sellers, on the other hand,
\n will want to see the price breaking lower to increase the bearish bets into the
\n 96.10 support next.<\/p>\n

USDINR TECHNICAL
\n ANALYSIS \u2013 1 HOUR TIMEFRAME<\/p>\n<\/p>\n

On the 1 hour
\n chart, we have another minor upward trendline that could act as support. If the
\n price pulls back, we can expect the buyers to lean on the trendline, with a
\n defined risk below it, to keep pushing into new highs. The sellers, on the other
\n hand, will look for a break to extend the correction into the next trendline.<\/p>\n

UPCOMING CATALYSTS<\/p>\n

Today<\/a>we
\n get the latest US Jobless Claims figures. Tomorrow, we conclude the week with
\n the University of Michigan Consumer Sentiment survey. The focus will remain on
\n US-Iran developments.<\/p>\n

\u00a0<\/p>\n

This article was written by Giuseppe Dellamotta at investinglive.com.<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"

FUNDAMENTAL OVERVIEW \u00a0 USD: The US dollar has been supported recently despite a dovish repricing triggered by Fed\u2019s Williams and Fed\u2019s Jefferson comments that pushed back against expectations of a rate hike…<\/p>\n","protected":false},"author":216,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[86],"tags":[],"class_list":["post-439687","post","type-post","status-publish","format-standard","hentry","category-market-news"],"_links":{"self":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/439687","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/users\/216"}],"replies":[{"embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/comments?post=439687"}],"version-history":[{"count":0,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/posts\/439687\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/media?parent=439687"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/categories?post=439687"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.swingfish.trade\/blog\/wp-json\/wp\/v2\/tags?post=439687"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}