New Delhi, June 29 -- The Indian rupee had done something it had not managed in four months: it was winning. Through most of June, the currency held at 84.3950 against the dollar - a first monthly gain since February - carried along by a domestic bond market that had been quietly one of the better-performing fixed-income trades in Asia. Then Iran launched strikes on U.S. military installations in Kuwait and Bahrain over the weekend, oil jumped, and traders arrived Monday morning to a different set of questions.

the magnitude of which will set the initial tone - feeds directly into India's import bill, its current-account arithmetic, and the inflation trajectory the Reserve Bank of India has spent months trying to bring under control. A s...