As rising oil prices combine with politics, rupee may fall to record low

The combination couldn't have come at a worse time, with rising Treasury yields spurring a selldown of emerging markets

Indian Prime Minister Narendra Modi and the rupee face a similar predicament -- old foes have re-emerged to keep them in check.

Brent crude rose above $80 a barrel last week for the first time since 2014, and is looking ominous for the nation’s budget deficit, inflation and the currency. Meanwhile, Modi faces the prospect of rival parties uniting to block his re-election bid after their success at a recent state poll.

Together, elevated oil prices and political uncertainty have sent the rupee 3 percent below the year-end analyst consensus targets, and some strategists expect the currency to