The Indian rupee could depreciate to 98 against the US dollar by July 2026, according to a top executive at BofA Securities, citing the ongoing energy crisis as a key factor. The currency was last trading at 95.77 on Wednesday.
Energy Crisis Impact
The energy crisis, characterized by soaring global oil prices and supply disruptions, is expected to exert significant pressure on the rupee. India, as a major oil importer, faces a widening trade deficit and higher import costs, which could weaken the currency further.
BofA Securities Forecast
A senior official from BofA Securities highlighted that the rupee's trajectory will depend on the duration and severity of the energy crisis. The forecast of 98 per dollar by July reflects the potential for continued depreciation if conditions persist.
The rupee has already faced headwinds from global monetary tightening and geopolitical tensions. The energy crisis adds to these challenges, making the currency vulnerable to further declines.
Market participants are closely watching developments in energy markets and central bank actions. The Reserve Bank of India may intervene to curb volatility, but sustained pressure could still push the rupee lower.
