The rupee's fall: A crisis or a necessary correction?

The Indian rupee crossed 96 per US dollar in May 2026, shedding roughly 6% since the US-Iran conflict erupted in late February 2026, which shut the Strait of Hormuz and pushed Brent crude near $100 a barrel. Foreign portfolio investors pulled over $24 billion from Indian markets between March and May 2026, while the merchandise trade deficit was on course to cross $300 billion in FY26. The RBI has intervened to manage the slide rather than arrest it, with the article highlighting India's structural vulnerabilities in oil dependence and shallow long-term institutional capital.