Mumbai, December 15, 2025: The Indian rupee fell to a new all-time low today, touching 90.74 against the US dollar during trading. This is the latest in a series of record lows this month. The currency has lost nearly 6% of its value against the dollar so far in 2025, making it one of the weakest performing currencies in Asia.
Traders say the fall comes from ongoing worries about a trade deal with the United States and big outflows of foreign money from Indian stocks. The Reserve Bank of India (RBI) stepped in to sell dollars and stop the rupee from falling too fast, but pressure remains high.
What Led to This Record Low?
The rupee started the year around 85 to the dollar. By early December, it crossed 90 for the first time, and now it has gone even lower. The main reasons are clear.
First, talks for a better trade deal with the US have dragged on without much progress. The US has high tariffs — up to 50% on some Indian goods — which hurt our exports. This makes investors worried, and they pull money out of India.
Foreign investors have sold more than $18 billion worth of Indian shares this year. That is one of the biggest outflows ever. When they sell stocks and take money back home, they need dollars, which pushes the rupee down.
Add to that, India buys a lot of oil and other things from abroad. When the rupee is weak, these imports cost more, and the trade gap gets wider.
An economist at ANZ, Dhiraj Nim, said, “The rupee weakness has further to go if tariffs are here to stay. Importers are buying dollars fast, while exporters are holding back, and outflows add more pressure.”
Another expert, Anil Bhansali from Finrex Treasury Advisors, told exporters to sell dollars now and importers to buy on small dips in the rate.
How the RBI is Handling It
The RBI has been active in the market. It sells dollars from its reserves to support the rupee and keep big swings away. India’s forex reserves are still strong at around $687 billion, but they have come down from higher levels earlier this year.
Traders say the RBI does not want the rupee to fall too sharply in one go. It lets the currency weaken slowly but steps in when needed. This managed fall helps exporters without causing panic.
One dealer said the central bank likely sold dollars today to cap the loss. Without that, the rupee could have gone even lower.
What Does This Mean for the Economy?
A weaker rupee has both good and bad sides.
On the good side, Indian goods become cheaper for buyers abroad. This can help exporters like those in IT, textiles, and pharmaceuticals sell more. It might bring in more dollars over time and create jobs.
But there are downsides too. Imports like oil, electronics, and medicines get costlier. Petrol and diesel prices could go up if oil companies pass on the cost. Many everyday items, from phones to fertilizers, might see higher prices.
This can push up inflation. Though inflation is low now, a much weaker rupee could add to it.
Companies that borrow in dollars will find it harder to pay back loans. But firms that earn in dollars, like software companies, will see bigger profits when they bring money home.
For common people, foreign travel or sending kids abroad for studies will cost more. Imported goods like chocolates or gadgets will feel pricier.
One report says labour-intensive sectors like textiles and leather do not get much benefit because they also import raw materials, which become expensive.
What Experts Are Saying
Many experts think the rupee could stay weak until there is news on the US trade deal.
“The expectations are one-sided right now,” said Dhiraj Nim from ANZ. “If tariffs stay high, the rupee has more room to fall.”
Others are hopeful. If a framework deal comes soon, as some officials hint, inflows could return.
The RBI’s next policy meeting will be watched closely. It might keep rates steady to support the rupee.
Naveen Mathur from Anand Rathi said the rupee might find support between 90 and 91 if the RBI keeps intervening.
Looking Ahead
The rupee’s path depends on a few things: progress in US-India trade talks, how much foreign money comes back, and global oil prices.
If a deal happens soon, the rupee could strengthen a bit. But without it, pressure might continue into next year.
India’s economy is still growing fast, faster than most big countries. Domestic buyers are stepping in where foreign investors pull out. That gives some cushion.
But for now, the record low is a reminder of challenges from outside. The government and RBI will keep a close watch to avoid big disruptions.
Frequently Asked Questions (FAQs)
1. Why has the Indian rupee fallen to a record low?
The main reasons are delays in a trade deal with the US, high US tariffs on Indian goods, and large outflows of foreign investment from Indian stocks. This year, foreign investors sold over $18 billion in shares. Importers also need more dollars, adding pressure.
2. Is the RBI doing anything about it?
Yes, the RBI sells dollars from its reserves to control sharp falls. It wants orderly weakening, not panic. Reserves are still good, giving room to manage volatility.
3. Will petrol and diesel prices go up?
Possibly yes, because India imports most oil. A weaker rupee makes oil costlier in rupees. But if global oil prices stay low, the impact might be small.
4. Is this good for exporters?
Yes, in many cases. Indian goods become cheaper abroad, so sales can rise. Sectors like software and pharma often benefit. But some, like textiles, import materials too, so gains are limited.
5. What about people planning foreign trips or studies?
It will cost more rupees now. For example, one dollar that cost 85 rupees at the start of the year now costs over 90. Plan ahead and check rates.
6. When might the rupee recover?
If a US trade deal framework is signed soon, or if foreign inflows return, it could stabilize. Experts say watch for news in the coming weeks.
7. Is the Indian economy in trouble because of this?
Not really in big trouble. Growth is strong, and domestic investors are buying. But prolonged weakness can raise import costs and inflation. The RBI is handling it carefully.