Rupee closes at all-time low on renewed US-Iran tensions; analysts see more downside 

The rupee closed at an all-time low against the US dollar on Tuesday as investors sold riskier assets due to renewed clashes in the Gulf and targeting of UAE infrastructure, which reignited supply chain fears. 

The Indian currency fell 2 paise to close at an all-time low of 95.25 against the US dollar . 

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Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities said, "Rupee extended its weakness, slipping below 95.25 to trade near 95.30 (-0.06%), as continued FII outflows and elevated crude prices above $100 kept pressure on the currency. Higher oil prices are worsening India’s import bill outlook, while lack of strong inflows is limiting any recovery. The overall bias remains weak, with the rupee consistently facing selling pressure on rebounds. In the near term, 94.70 is likely to act as resistance, while 95.50 is seen as immediate support, with markets closely tracking US non-farm payrolls and unemployment data this week for further direction."

Brent crude oil, hovering near $110 per barrel, is maintaining pressure on oil-importing economies like India, said forex traders. 

Moreover, factors such as unabated foreign capital outflows amid rising geopolitical uncertainties dented investor sentiments further. 

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Earlier, the rupee opened at 95.30 against the US dollar, then lost ground and touched an all-time low of 95.44 in intra-day trade. 

On Monday, the rupee fell 39 paise to close at an all-time low of 95.23 against the US dollar. 

"We expect the rupee to trade with a negative bias on rising global crude oil prices as the Strait of Hormuz continues to remain closed. Dollar demand from importers and ongoing geopolitical tensions between the US and Iran may also pressure the rupee. "However, RBI intervention may support the rupee at lower levels. USDINR spot price is expected to trade in a range of 95.10 to 95.55," said Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan. 

Brent crude, the global oil benchmark, was trading lower by 1.57 per cent at $112.64 per barrel in futures trade. 

On the equity market front, Sensex fell 251.61 points to end at 77,017.79, while the Nifty fell 86.50 points to 24,032.80.