Rupee hits record low as trade talks stall and foreign money exits India
Experts say the one major reason for the fall is high tariffs on Indian goods, which have reduced exports
PTC Web Desk: The Indian rupee fell to its weakest level ever against the US dollar on Monday. It slipped to 90.74, breaking the previous record low seen last week. The currency has been under pressure due to delays in trade talks between India and the United States. Heavy selling by foreign investors in Indian stocks and bonds has also hurt the rupee.
So far this year, the rupee has lost nearly 6% of its value. One major reason is high US tariffs on Indian goods, which have reduced exports and made Indian markets less attractive to global investors.
Foreign investors have already sold Indian shares worth over $18 billion in 2025. They have also pulled out more than $500 million from Indian bonds this month.
Traders said the rupee could have fallen more sharply, but the Reserve Bank of India likely stepped in to prevent sudden volatility.
India’s trade data for November is expected later in the day. Economists believe the trade deficit may narrow to around $32 billion, compared with a record $41 billion in October.
Sentiment remains weak after India’s chief economic adviser said a US-India trade deal may only be possible by March. Reports also suggest that a trade agreement with the European Union may not be completed this year.
Despite a weaker US dollar globally, the rupee has not gained much benefit. Analysts warn that the rupee could fall further if it crosses the 90.80 level.
Meanwhile, India’s foreign exchange reserves stood at $687.3 billion as of December 5, lower than the peak seen in September.
Indian stock markets also opened lower, with the Sensex and Nifty falling around 0.2% each as investors stayed cautious.