Athira Sethu
Kochi, 23 March 2026
The value of the Indian rupee has fallen to a record low against the U.S. dollar due to the growing Middle East conflict, which has sparked fears over energy supply disruption. The growing tensions in the Middle East have caused the value of most Asian currencies to fall, with some falling by 0.1 to 0.8 percent.
Why is the Rupee falling?
On Monday, the value of the rupee fell to 93.84 against the U.S. dollar, surpassing the previous record low of 93.7350 on Friday. The rupee has fallen to a record low against the U.S. dollar due to the growing tensions in the Middle East, which have caused oil prices to surge. The prices have risen by over 50 percent since the conflict began, and experts have predicted that this conflict may be even worse than the two major oil crises in the 1970s.
Impact on India
The Indian rupee is more prone to the impact of changes in oil prices because India is a net importer of oil. With the increase in oil prices, it is getting more costly for India to fulfill its oil demands, impacting the value of the Indian rupee. The value of the rupee has declined by 3% since the start of the war.
Global Consequences
The war has escalated to the point where Washington and Tehran are exchanging threats. The hopes of resolving the war are declining as the war is entering its fourth week. With the escalation of oil prices, the International Energy Agency has stated that the situation is more critical than ever.
Future Outlook
In the coming days, the value of the rupee is likely to decline further. According to a prediction by BofA Global Research, the value of the rupee is likely to decline to 94 by June 2026. This is in contrast to their earlier prediction of 89. This prediction is based on the assumption that the crisis in the Middle East will resolve within the next few weeks.
