The Indian rupee came under renewed pressure on Friday, weakening to around Rs.95.46 against the US dollar as elevated crude prices and a broader risk-off mood weighed on emerging-market currencies. Higher oil prices are particularly important for India because a rise in the cost of imported crude can increase demand for dollars and widen pressure on the trade balance.
The market is also monitoring US Treasury yields, which have moved close to 5%. A combination of expensive crude, higher global yields and continued foreign investor selling could keep volatility elevated in domestic markets.
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