Neelkanth Mishra, chief economist at Axis Bank, warns that the Indian rupee could weaken to 100 per dollar if crude oil prices stay above $110 per barrel. Recent interventions by the Reserve Bank of India may delay necessary rate hikes, as the rupee has already depreciated significantly since the onset of conflict in West Asia.

• 01The rupee may weaken to 100 per dollar if oil prices remain above $110 per barrel.
• 02The Reserve Bank of India’s interventions have delayed immediate rate hikes.
• 03The rupee has fallen by 4.5% against the dollar since February 28, 2023.
• 04The RBI is expected to maintain the repo rate at 5.25% amid rising inflation.
• 05India is better prepared for economic shocks compared to past crises.

If the rupee weakens significantly, it could lead to higher import costs, affecting prices of goods and services in India.