Indian Rupee Hits Record Low, Crosses ₹90 per USD

The Indian rupee fell to a record low against the US dollar on Wednesday, crossing the ₹90 mark for the first time. On Wednesday morning, it weakened to ₹90.13 per dollar, surpassing its previous all-time low of ₹89.95 recorded the previous day. By 8:04 AM UTC, the currency stood at ₹90.26 per US dollar.

Analysts attribute the decline to uncertainty surrounding the delayed trade deal between India and the United States. Market experts note that the rupee is experiencing an imbalance of demand and supply, compounded by foreign fund outflows and limited intervention by the Reserve Bank of India.

The central bank has occasionally supported the rupee through dollar sales to defend key levels but has also allowed greater flexibility to maintain a healthy growth trajectory rather than defending an artificial exchange rate.

Experts also highlight that ongoing delays in the trade agreement continue to strain the currency. Daily foreign exchange demand from trade deficits and capital outflows is pushing the dollar higher, while supply remains thin.

Despite the currency's weakness, foreign investors are showing signs of impatience, with net inflows flattening since October after a brief period of positive inflows.

India's Chief Economic Adviser has reassured that the weakening rupee is not a major cause for concern. He emphasized that the current fall is unlikely to affect inflation or exports significantly and expressed optimism that the additional tariffs imposed by the US may soon be addressed, potentially reducing reciprocal tariffs to anticipated levels.