The Indian rupee plummeted to a record low of 92.33 against the US dollar on Monday, battered by a surge in global crude oil prices and escalating war fears in West Asia.
The currency's retreat is directly tied to a shock in global energy markets, with Brent crude oil prices spiking over 25% to trade near $117 a barrel.
The roughly 50% cumulative surge in oil prices is being driven by the expanding Iran war, which has intensified fears of prolonged supply disruptions through the critical Strait of Hormuz.
As India, one of the world's largest importers of crude, faces a severe macroeconomic headwind, the market's focus has shifted to the Reserve Bank of India (RBI) to step in and calm the market.
The central bank actively deployed its reserves last week to temper the rupee's descent, and market participants widely expect renewed dollar-selling interventions if the depreciation accelerates.
The rupee's localised struggles are playing out against a backdrop of sweeping global risk aversion, with US stock futures dropping over 2% in early trading and Asian equities posting declines of roughly 6.5%.
