The Indian rupee slipped to a fresh all-time low on Monday, pressured by stalled U.S.-India trade negotiations and continued foreign investor outflows from domestic equity and bond markets.
The rupee weakened by around 0.3% to 90.74 per U.S. dollar, breaching its previous record low of 90.55, which was recorded on December 12. This makes the rupee the worst-performing currency in Asia so far this year.
Market participants said losses could have been sharper if not for intermittent intervention by the Reserve Bank of India (RBI), which appears focused on containing excessive volatility rather than defending a specific level.
Sentiment took a hit after India’s Chief Economic Adviser indicated that a U.S.-India trade agreement is unlikely before March, prolonging uncertainty. Additionally, reports suggest that India and the European Union may also miss the year-end deadline to finalise a trade deal.
Persistent foreign portfolio outflows have further weighed on the rupee, preventing it from benefiting from a broadly weaker U.S. dollar. The dollar index has declined about 1.1% so far this month, but the rupee has failed to gain from this trend.
According to currency experts, the next key support level for the rupee lies near 90.80, with risks of a further slide towards 91–92 levels if pressure continues. Analysts note that the RBI has allowed market forces to guide the currency while stepping in only to smooth sharp movements.
Meanwhile, India’s foreign exchange reserves stood at $687.3 billion as of December 5, down from a peak of $703 billion reached in early September.
Indian equity markets also remained under pressure. The BSE Sensex and Nifty 50 both declined around 0.2%, tracking weak regional cues ahead of a crucial week of global economic data releases and central bank policy meetings.
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