Rupee hits 95.80 as oil surges amid US Iran tensions
The Indian rupee just dropped to its lowest ever, 95.80 against the US dollar, thanks to rising tensions between the US and Iran and the closure of the Strait of Hormuz.
With global oil prices up nearly 50% since February, India's import bills are soaring, and the rupee has lost over 5% in value since this conflict started, making it Asia's worst-performing currency so far this year.
India raises duties and RBI intervenes
To help steady things, Prime Minister Modi's government bumped up import duties on gold and silver to protect foreign reserves.
The Reserve Bank of India (RBI) stepped in to support the currency but hasn't raised interest rates yet, with Barclays analysts calling that a last resort.
RBI Governor Sanjay Malhotra says more action might be needed if inflation keeps climbing.
Analysts warn that unless oil prices drop or foreign investment improves, we could see fuel price hikes and even more pressure on India's economy if the conflict drags on.