Wednesday 04 / March / 2026
Muscat: The intensifying conflict in the Middle East has sent shockwaves through global financial centres, weakening the Indian rupee while currencies such as the Pakistani Rupee (PKR) and Bangladeshi Taka (BDT) have remained relatively stable.
While the Indian Rupee has been falling steadily, the Philippine Peso (PHP) was less volatile on Wednesday. It opened at P58.43 against the US dollar, rose to P58.65 during the day, and closed at P58.39. In Oman, exchange houses were offering PHP 151 per Omani rial.
“The Pakistani Rupee (PKR) and Bangladeshi Taka (BDT) are considered less volatile compared to other currencies in the region. These currencies are not freely convertible and their exchange rates are fixed by the respective central banks after taking into account key economic indicators. Therefore, daily volatility like we see in the Indian rupee or other currencies is lower in PKR and BDT,” said R. Madhusoodanan, a Muscat-based financial expert.
On Wednesday morning, exchange houses in Oman were offering 725 PKR and 317 BDT against one Omani Rial. The Philippine peso was trading at 151 against the Rial. However, the sharp focus remains on the Indian rupee. Exchange houses were offering INR 238.15 against one Omani Rial, with rates touching up to INR 238.35 during mid-day trade.
The Indian rupee fell sharply against the US dollar on Wednesday, touching an intra-day low of 92.3025 before closing at 92.15. The fall is largely attributed to global factors, including surging crude oil prices and the ongoing Middle East crisis.
Brent crude climbed to around $83 per barrel. India, which meets nearly 85 per cent of its oil demand through imports, is particularly vulnerable to rising energy prices. In addition, considerable foreign exchange is spent on defence imports, gold and electronic goods.
Any increase in the USD-INR exchange rate negatively impacts the country’s Current Account Deficit. A weaker rupee also risks pushing inflation above the comfort level of the Reserve Bank of India. Foreign debt repayments, overseas education, travel and medical treatment abroad are set to become more expensive as the rupee depreciates.
Global risk aversion has further weighed on the currency. Investors have been shifting assets to safe havens such as gold, silver and US Treasury bonds. The dollar index surged to 99.33, reflecting the strength of the US dollar against a basket of major currencies.
Foreign Institutional Investors (FIIs) have also pulled back funds from Indian equities, adding pressure on the rupee. The year-to-date sell-off is reported at $2.1 billion.
Whenever the rupee experiences heightened volatility, the RBI typically intervenes in the forex market by selling dollars to meet increased demand. However, such interventions are having limited impact amid prevailing global uncertainties. India’s forex reserves stood at $723.60 billion as per figures released on February 20, 2026.
The rupee has been under pressure for several months, partly due to delays in signing a trade agreement with the US administration and retaliatory tariffs that have affected exports to America. Last year, the rupee depreciated by nearly 5 per cent — more than many of its Asian peers. In the first two months of this year alone, it has weakened by over 2 per cent, making it one of the worst-performing regional currencies.
For Non-Resident Indians (NRIs), however, the depreciation brings short-term gains. One Omani Rial fetched 222 rupees in January 2025; it has now crossed 238 — an increase of 16 rupees per Rial.
“The rupee has inherent weakness at the moment. Volatility will continue in the short-term horizon,” Madhusoodanan said.
The critical question for millions of expatriate workers now is whether to remit funds immediately to take advantage of current rates or wait in anticipation of further gains.
