Economy· August 17, 2026 at 02:59 a.m.
Indian Rupee Hits Two-Week Low Amid Oil Price Increase and FX Swap Window Closure
Key takeaways
- Indian rupee hits two-week low
- RBI closed FX swap window
- Oil price increase contributes to currency decline
The Indian rupee has reached a two-week low due to rising oil prices and the closure of an FX swap window. The decline in the currency's value is significant as it increases the cost of importing crude oil, which could potentially worsen India's current account deficit.
The rupee fell 0.6% against the US dollar on Wednesday, reaching a level not seen since mid-March. The decline comes after the Reserve Bank of India (RBI) closed its FX swap window for the second time this year, reducing liquidity in the foreign exchange market.
In response to the situation, an RBI official stated that the bank would continue to monitor the currency market and take necessary measures to ensure stability. The official also noted that the closure of the FX swap window was a pre-scheduled move aimed at managing liquidity.
India is heavily dependent on oil imports, making it vulnerable to fluctuations in global crude prices. The country's current account deficit widened to $18.7 billion in the fourth quarter of 2021, up from $15.4 billion in the previous quarter.