Rupee Sinks To New Historic Low Against Dollar, Opens Weaker

The Indian rupee plunged to a fresh record low of Rs 90.57 per US dollar in early trade on Monday, extending its downward trajectory amid persistent dollar strength and global risk aversion. The currency opened 14 paise lower compared to Friday’s close of Rs 90.41, signaling continued pressure on the currency.

The rupee depreciated by 17 paise to close at an all-time low of 90.49 against the US dollar on Friday, mainly due to uncertainty over the India-US trade deal and persistent foreign fund outflows dented investor sentiment.

Harshal Dasani, Business Head, INVAsset PMS said the rupee’s slide to a new low is less about broad dollar strength and more about India-specific uncertainty. "The dollar index has actually softened from recent highs following the Fed’s rate cut and weaker US macro data, indicating that global dollar momentum is easing. Yet USDINR continues to stay elevated, primarily due to the delay in the India–US trade deal."

He further added that the markets had priced in progress on tariff rationalisation and greater market access, but the lack of a clear announcement has created a temporary overhang on sentiment. That divergence — a softer global dollar but a weaker rupee — highlights how deal-related uncertainty is disproportionately affecting USDINR.

Dasani also said that, domestically, India’s fundamentals remain strong, with steady growth, moderating inflation, and over $688 billion in FX reserves. This suggests the current move is sentiment-driven rather than structural. Once the trade agreement is finalised, USDINR could correct meaningfully as clarity on tariffs, supply chains, and export competitiveness improves.

The RBI’s calibrated interventions continue to smooth volatility, and the underlying macro fabric does not warrant a prolonged depreciation cycle, he said.