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Indian rupee weakened on Sept 15 due to rising crude oil prices and expected US Fed rate hike. RBI intervened to curb volatility.
By Anshul September 15, 2026, 9:34:59 AM IST (Published)
3 Min Read
The Indian rupee weakened on Tuesday (September 15), coming under pressure from rising crude oil prices and growing expectations of a US Federal Reserve rate hike this week.
The rupee opened at 95.75 per dollar, compared with Friday’s (September 11's) close of 95.55, marking a 20-paise decline.
State-run banks were seen offering dollars, likely on behalf of the Reserve Bank of India, as the central bank appeared to step in to contain excessive volatility. Four traders told Reuters that RBI intervention was likely, although the dollar sales were not particularly heavy.
Why is the rupee under pressure?
The immediate pressure on the rupee is coming from the sharp rise in crude oil prices. Brent crude was trading around $106.9 a barrel, up about 1.2% on the day, after rising above $107 earlier in Asian trading.
Oil prices have surged amid continued tensions involving the US, Iran and the Strait of Hormuz, with fresh attacks by Iran-backed Houthi forces in Yemen adding to concerns over supply disruptions.
For India, higher crude prices are a concern because the country imports a large share of its oil requirements. A sustained rise in crude prices can increase the country's import bill and demand for dollars, potentially putting further pressure on the rupee. Higher energy costs can also add to domestic inflation pressures.
US yields add to pressure
The oil rally has also fuelled inflation concerns in the US and pushed Treasury yields higher. The 10-year US Treasury yield touched 5%, its highest level in nearly three years, according to Reuters.
Markets are now pricing in a higher likelihood of a US rate hike this week. Higher US yields and expectations of tighter US monetary policy can support the dollar and reduce the relative appeal of emerging-market currencies such as the rupee.
95.80/$ key level for rupee
The 95.80-per-dollar level has emerged as an important near-term level for the rupee. The RBI has reportedly intervened around this level in recent sessions to prevent a sharper decline in the currency.
Reuters reported that the central bank was seen selling dollars near 95.80 on Friday, while similar intervention was reported in mid-August.
A sustained break below the 95.80 level could weaken the rupee's near-term technical setup and trigger fresh dollar buying. According to a bank currency trader cited by Reuters, ₹96 per dollar is the next psychological marker, while a sustained move beyond that level could expose the rupee to a deeper bout of depreciation.
What to watch
For the rupee, crude oil prices, US Treasury yields and RBI intervention will remain key near-term drivers. Markets will also track the US Federal Reserve's policy decision this week for signals on the future path of US interest rates.
A combination of elevated oil prices, higher US yields and stronger dollar demand could keep the rupee under pressure, while continued RBI intervention could help limit excessive volatility.
-With Reuters inputs
