Interest rates, crude oil, and the rupee
The Reserve Bank of India has raised interest rates, oil prices are elevated, and a weaker rupee has eroded returns for overseas investors. India’s foreign exchange reserves declined by nearly $60 billion in six weeks to $726.027 billion as of October 9, from a record high of $785.706 billion on September 4. The fall was largely attributed to the Reserve Bank of India’s intervention to support the rupee amid rising crude oil prices. Crude oil prices held near $108.3 a barrel as renewed fighting across West Asia heightened concerns over supply disruptions.