Indian rupee hits all-time low of 89.46 against US dollar
What's the story
The Indian rupee has hit a new all-time low against the US dollar, falling to 89.46 on Friday. The decline comes amid fading hopes of a Federal Reserve rate cut and ongoing US-India trade tensions. The currency's value has been further pressured by high demand for dollars and limited support from the Reserve Bank of India (RBI).
Currency performance
Rupee's fall surpasses previous record lows
The rupee's latest slump has surpassed its previous all-time low of 88.8, which was recorded in late September and earlier this month. At 3:05 pm, INR was trading at 89.46 against the greenback compared to 88.6787 at the open and 88.7075 at the previous close. With this drop, the currency is down 0.86% against the dollar since yesterday. The RBI had actively defended this level in recent sessions but traders noted a significant absence of support this time around.
Market influences
US tariffs and foreign investor withdrawals impact rupee
The rupee's depreciation has been fueled by steep US tariffs on Indian exports that came into effect in late August. The currency is now one of the weakest major Asian currencies this year, with foreign investors pulling out $16.5 billion from Indian equities so far. Traders have also noted a spike in dollar demand from importers while exporters have remained relatively inactive, further adding pressure on the currency.
Outlook
Rupee's future remains uncertain amid global risk sentiment
The future of the rupee is uncertain as global risk sentiment remains fragile and investors await clearer signals from the Federal Reserve and ongoing trade negotiations between Washington and New Delhi. "Once 88.80 broke, volumes spiked sharply," a trader at a private sector bank said, describing the move as a stop-loss-driven rush that swept through the market.