Rupee Slumps to All-Time Low Near 90.58 per Dollar as Trade Talks Loom
Rupee Slumps to All-Time Low Near 90.58 per Dollar as Trade Talks Loom
Rupee hits an all-time low near 90.58 per dollar, weighing on markets amid stalled India-US trade talks, weak inflows, and a widening trade deficit.
The Indian rupee slipped to an all-time low near 90.58 per US dollar on currency markets, marking the second consecutive week of record declines. Traders cited a lack of progress on a US-India trade deal, weaker capital inflows, and a widening trade deficit as key drag factors, even as domestic markets opened with caution. The move kept the currency under pressure amid global risk-off sentiment and ongoing uncertainty around policy steps.
Forex desks described a persistent negative bias as investors waited for fresh cues from negotiations on a potential India-US trade agreement. Weakness in global markets and sustained foreign fund outflows compounded the rupee's fall, with major stock indices slipping in early trade. The Sensex and Nifty both traded lower as market breadth narrowed and risk appetite waned.
Analysts warned that a prolonged rupee depreciation could raise import costs and feed through to inflation, complicating policymakers' tasks. Some noted that a deteriorating currency can also impact external financing costs and the overall health of the economy. Traders said a breakthrough in trade talks or unexpected policy measures could help stabilize sentiment, but until then volatility is likely to remain a feature in the near term.
In Mumbai, where currency and equity markets closely track global cues, traders were watching closely as foreign flows remained a key driver of the rupee's trajectory. Investors will be looking for signs of a settlement or a shift in stance that could restore confidence and support the currency and equities in the days ahead.
Cover image source: Rupee falls to all-time low against U.S. dollar in early trade 🔗
