Rupee Slips to Historic Low Amid Global and Domestic Pressures
The Indian rupee fell to a record low of 92 against the US dollar during intraday trade on Friday before recovering slightly to close at 91.88 (provisional). The sharp fall was driven by foreign fund outflows, weak domestic equity markets, and rising global uncertainty.
According to forex market experts, the rupee erased its early gains as selling pressure intensified through the day, pushing the currency to its weakest level ever.
Key Reasons Behind the Rupee’s Fall
Several global and domestic factors contributed to the sharp depreciation of the Indian currency:
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Persistent selling by foreign institutional investors (FIIs)
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Weak performance in Indian stock markets
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Rising crude oil prices, increasing India’s import bill
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Higher US Treasury yields, strengthening the US dollar
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Ongoing risk-off sentiment in global financial markets
At the interbank foreign exchange market, the rupee opened at 91.45, strengthened briefly to 91.41, and then dropped sharply to an intraday low of 92.00 before settling lower.
Recent Performance of the Indian Rupee
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On Thursday, the rupee had closed slightly higher at 91.58, gaining 7 paise.
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The previous all-time low was recorded on January 21, when the currency closed at 91.65.
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So far in January, the rupee has weakened by 200 paise, marking a decline of over 2%.
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In 2025, the rupee had already fallen by nearly 5% due to sustained dollar strength and capital outflows.
Expert Outlook on USD-INR Movement
Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, said the rupee is likely to remain under pressure in the near term.
“The USD-INR pair may continue to trade with a negative bias due to ongoing FII selling and cautious global sentiment. Importer demand and hedging activity could further weigh on the rupee,” he said.
However, he added that RBI intervention and a weaker US dollar could provide some relief at lower levels. The USD-INR spot rate is expected to move in the 91.60–92.30 range.
Global Market Indicators
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The dollar index, which tracks the US currency against six major global currencies, was marginally higher at 98.36.
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Brent crude oil prices rose 1.03% to USD 64.72 per barrel, adding pressure on the rupee.
Impact on Indian Stock Markets
Indian equities ended sharply lower, reflecting weak investor sentiment:
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Sensex dropped 769.67 points to close at 81,537.70
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Nifty 50 fell 241.25 points to settle at 25,048.65
On Thursday, foreign institutional investors sold Indian equities worth ₹2,549.80 crore, according to exchange data.
Conclusion
The fall of the Indian rupee to a historic low highlights mounting challenges from both global and domestic fronts. With foreign fund outflows, volatile oil prices, and global economic uncertainty, the rupee may continue to face pressure in the near term, even as market participants watch closely for RBI action and shifts in global currency trends.
