The Indian rupee has slipped to a fresh all-time low against the US dollar, reflecting sustained pressure from global and domestic factors. The currency’s decline comes amid a stronger dollar environment, persistent foreign fund outflows, and concerns around global interest rate trajectories.

Key Highlights

• Indian rupee falls to a fresh record low against the US dollar amid global pressures.
• Dollar strength, foreign outflows, and trade deficit concerns continue to weigh on rupee outlook.

Market participants point to the resilience of the US economy and elevated US bond yields as key drivers supporting the dollar, making emerging market currencies like the rupee less attractive in the near term. Additionally, ongoing geopolitical uncertainties and cautious global risk sentiment have added to volatility in currency markets.

On the domestic front, India’s widening trade deficit and steady demand for dollars from oil importers have further weighed on the rupee. While the Reserve Bank of India (RBI) has been active in managing excessive volatility through market interventions, analysts note that the central bank appears comfortable allowing gradual depreciation as long as movements remain orderly.

Experts believe the rupee’s near-term direction will largely depend on global cues, particularly signals from the US Federal Reserve on interest rates, inflation data, and capital flow trends. Any moderation in US yields or improvement in global risk appetite could offer temporary relief.

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However, analysts caution that downside risks remain, especially if crude oil prices rise sharply or foreign portfolio outflows intensify. Over the medium term, India’s strong economic growth prospects, stable forex reserves, and policy support are expected to provide a buffer, even as short-term currency pressures persist.