The rupee weakened for a second straight session on Friday ​as surging oil prices spurred risk aversion, erasing gains made earlier ‌in the week and leaving the currency little changed, ​despite easing expectations of further US rate hikes.

The ⁠rupee opened the session marginally higher at 94.79 against the US dollar, but turned lower in early trades to hit a low of ‌94.9725. The currency ended 0.1% lower for the day at 94.9400, after depreciating by 0.4% on ‌Thursday. It was little changed for the week, after ‌rising ⁠1.4% last week.

Oil prices rose in the latter ⁠half of the week including in Asian hours, with the benchmark Brent crude touching a more than five-month high, after attacks in Saudi Arabia ​by Yemen's Houthis stoked concern ‌over further disruption to energy supplies from the region.

The Brent crude contract was hovering around $114 per barrel, and is on track to post a third straight weekly surge.

While facing ‌a shock from oil prices, investors have been reassessing ​technology trades and pulling back from riskier assets on worries about stretched valuations for artificial intelligence-led companies, ⁠leading to a selloff in stocks and rising demand for safe-haven US Treasuries.

The odds of a rate hike by the ‌Federal Reserve have dropped to single digits from as high as 70% a month ago, which provided brief relief to the rupee in the early session, but oil worries outweighed the positive move.

Energy prices have remained elevated fuelling concerns about inflation and imported energy costs, which hit the nation's current ‌account calculations.

Currency traders also cited some residual flows linked to the Jio ​Platforms initial public offering.

These flows, alongside the unwinding of dollar-long positions triggered by the Reserve Bank of ⁠India's latest measures, had lifted the currency to a six-week ⁠high of 94.30 per dollar on Thursday, before importers stepped up dollar purchases.

"The RBI's recent FX measures are short-term ‌stabilizers, not necessarily unjustified, but insufficient to alter the medium-term bearish outlook on the rupee," Apoorva Javadekar, chief economist at ​Shriram Research, said.

Published on October 23, 2026