The Indian rupee could plumb to record lows again this week, while bonds are expected to extend their fall, as investors fret over growth-inflation risks facing Asia's third-largest economy on account of the Iran war. The rupee slipped past the 96-per-dollar mark to hit a record low last week, falling 5% since the Iran war erupted on February 28. Brent crude oil prices climbed to nearly $110 per barrel, sending global bond yields higher on rising expectations that central banks would need to tighten monetary policy to rein in inflationary pressures.
Policymakers in India have also taken measures to ease pressure on the rupee including by imposing curbs on imports of precious metals. The central bank has intervened in markets alongside limiting the size of banks' net open positions.
