Flight to safety, rising oil put Indian rupee’s recovery to the test

Business Recorder reported that the Indian rupee could come under renewed strain on Friday as investors seek safer assets and more expensive crude raises importers’ hedging needs. Traders put the currency’s expected opening at 94.84-94.88 per dollar, following Thursday’s close of 94.8175. A day earlier, it had briefly reached its strongest level in over six weeks, around 94.30, before losing ground.

The move contrasted with broader market action and surprised bankers, adding uncertainty to the currency outlook. US Treasuries and the yen gained, while American shares fell amid questions about artificial-intelligence spending; the 10-year Treasury yield slipped below 5% and was 40 basis points beneath its recent peak. Brent crude approached $115 a barrel amid concerns about supply interruptions following Houthi attacks on Saudi Arabia. ING Bank described defensive positioning in markets and said elevated energy costs were increasingly accompanied by worries about growth, rather than expectations of persistently higher interest rates.