Why the Indian rupee is undervalued—even with a strong economy

Business Dec 04, 2025

India's economy is on a roll, but the rupee still lags behind the US dollar.
According to Commerce Minister Piyush Goyal, this isn't because India's fundamentals are weak—it's mostly due to foreign investors pulling money out.
Since August, the rupee has slipped from 87.85 to 90.20, even as other emerging market currencies are actually gaining ground.

How India's economy is holding up

Despite the currency dip, India posted an impressive 8.2% growth in Q2 and saw the lowest inflation in the last few months.
Foreign exchange reserves are solid, and there's more spending on infrastructure and by consumers—basically, all signs point to a resilient economy underneath those currency headlines.