Malavika Kaur Makol

India is rushing to contain the fallout of the Iran war, as soaring oil prices hammer the rupee and drive record foreign outflows from local stocks.

A slide in the Sri Lankan rupee, Asia’s worst performing currency this month, has intensified due to speculation of further weakening, according to Deputy Minister of Finance Anil Jayantha Fernando.

Global investors expect the Indian rupee to weaken further, with some even gaming out scenarios where the currency falls to an unprecedented 100 per dollar.

India’s treasury bill yields surged at a weekly auction, signaling fixed-income traders are starting to price in potential interest-rate hikes by the central bank.

The Sri Lankan rupee weakened to a three-year low on Thursday, underperforming all Asian peers, as a gain in oil prices weighed on the currency.

The Sri Lankan rupee surged against the dollar, snapping a nine-day losing streak to become Asia’s best-performing currency on Friday.

The Sri Lankan rupee is set to recover from its slide by the end of this year as oil prices are set to decline and as the central bank raises interest rates, according to BMI.

The Sri Lankan rupee is set to recover from its slide by the end of this year as oil prices are set to decline and as the central bank raises interest rates, according to BMI.

Sri Lanka’s central bank took steps to boost dollar liquidity in the interbank market as part of a series of measures to curb excessive depreciation in the rupee, Governor Nandalal Weerasinghe said.

Asian central banks are turning to ever more aggressive interest-rate hikes to shore up currencies, though there are few signs of success.