The Indian rupee tumbled to a new record low on Friday, falling 21 paise to trade at 88.36 against the US Dollar, weighed down by persistent foreign fund outflows and renewed global trade tensions. The currency had settled at 88.15 on Thursday.
The decline comes despite recent domestic policy support, including sweeping GST reforms aimed at boosting consumption. The government's move aims to simplify the tax structure, reducing the four-tier system to two slabs of 5% and 18%, while introducing steep 40% rate on luxury and sin goods. This move was largely expected to provide relief to household and stimulate demand. However, the rupee remained under pressure as global headwinds overshadowed local measures.
“The rupee is holding near its record low despite aggressive fiscal steps. The market is reacting more to external factors, especially the US tariff hikes and foreign equity outflows,” said Jigar Trivedi, Senior Research Analyst at Reliance Securities.
Global markets ended on a cautious note after soft U.S. labour market data reinforced expectations of near-term monetary easing by the Federal Reserve.
“Global risk sentiment remains fragile,” said Ritesh Bhansali, Deputy CEO at Mecklai Financial Services. “President Trump's renewed tariff threats on semiconductor imports have further clouded trade relations, adding to the rupee's vulnerability.”
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
