MUMBAI, March 27 (Reuters) – The Indian rupee hit a record low past the 94-per-dollar mark on Friday, hammered by worries that the energy supply crisis sparked by the Middle East war will drag on, deepening the pressure on energy importing economies.
The rupee fell to 94.1575 per dollar, eclipsing its previous all-time low of 93.98 hit earlier this week. It has declined about 3.5% since the war began late last month.
The threat of a protracted energy shock has kept oil prices above the $100-per-barrel mark, weighing on global equities and sending bond yields higher.
Analysts have shaved growth forecasts for India, with some also anticipating rate hikes by the Reserve Bank of India over the next 12 months as the spillovers from the crisis threaten to lift inflation.
Even if a lengthy conflict is avoided, Bernstein sees a realistic chance of the rupee breaching the 98-per-dollar level this year, with pressure primarily stemming from India’s current account balance.
(Reporting by Jaspreet Kalra)