CURRENCY OVERVIEW

The Indian rupee weakened for a second straight session on Friday as surging oil prices spurred risk aversion, erasing gains made earlier in the week and leaving the currency little changed, despite easing ‌expectations of further US rate hikes. The rupee opened the session marginally higher at 94.79 against the US dollar, but turned lower in early trades to hit a low of 94.9725. The currency ended 0.1% lower for the day at 94.9400, after depreciating by 0.4% on Thursday. It was little changed for the week, after rising 1.4% last week. Oil prices rose in the latter half of the week including in Asian hours, with the benchmark Brent crude touching a more than five-month high. The Brent crude contract was hovering around $114 per barrel, and is on track to post a third straight weekly surge. While facing a shock from oil prices, investors have been reassessing technology trades and pulling back from riskier assets on worries about stretched valuations for artificial intelligence-led companies, leading to a ‌selloff in stocks and rising demand for safe-haven US Treasuries. The euro headed for a weekly loss against the dollar and the yen as a fresh sell-off in France's government bonds led the country's debt risk premium to levels not seen since ‌the euro area sovereign crisis in 2011 on Thursday. The greenback also came under pressure during the week as a tech-led market selloff showed the dollar was no longer attracting its usual safe-haven flows, with doubts about the sustainability of the AI investment boom fuelling expectations of a more dovish Federal Reserve. Strategists said that while both the euro and the dollar faced selling pressure this week, the single currency was hardest hit. Meanwhile the Japanese currency jumped on Thursday as investors sought safety amid fragile equity markets and concerns about France's fiscal trajectory and possible new street riots. The euro was last down 0.15% at $1.1198 , set to end the week 0.42% lower. It fell more sharply against the yen, touching its lowest level since October 2025 at 175.42 yen on Friday , down 0.24% and on track for a weekly decline of 1.18%. The dollar was flat at 156.73 yen . terling edged up to a fresh 17-month high versus the euro on Friday, on track for its fourth straight weekly rise, after UK data provided mixed signals about the British economy. Sterling fell 0.15% to $1.3381 against a strengthening dollar after reaching $1.3418 on Thursday, its highest level since September 16. Economists remained cautious about the UK economic outlook. Oil prices rose on Friday, with Brent crude touching a more than five-month high, after Houthi ‌attacks in Saudi Arabia stoked concern over further disruption to energy supplies from the Middle East. Brent crude futures gained $1.14, or 1%, to $114.31 a barrel by 1006 GMT, having earlier reached $114.72 for the highest level since May 4. US West Texas Intermediate crude gained $1.65, or 1.7%, to $101.12. The Brent benchmark is on track for a third consecutive weekly gain, of about 4% while WTI is poised to finish 0.3% down on the ?week. Clashes between the Houthis and a Saudi-led coalition that backs Yemen's internationally recognised government have raged since the Iran-aligned Houthis pushed towards Bab el-Mandeb, a shipping chokepoint at the mouth of the Red Sea. Gold edged slightly up from a three-month low hit ‌earlier on Friday and is on track for its steepest weekly loss since June, as rising oil prices fuelled higher-for-longer Federal Reserve rate expectations and pressured the non-yielding precious metal. Spot gold was at $4,026.15 per ounce by 0936 GMT after earlier dropping to $3,986.50, its lowest level since July 20. US gold futures for December delivery fell 0.5% to $4,040.70 per ounce. Among other metals, spot silver slid 1.2% to $53.8882 per ounce, and palladium dropped ?0.3% to $1,051.06, hitting their lowest since November 2025 and June 2025 respectively. Spot platinum fell 0.8% to $1,557.03 per ounce, its lowest since July. All three metals were headed for weekly declines.