The Indian rupee reached a historic low of Rs 89.71 against the US dollar on Friday, marking a depreciation of 103 paise from Thursday’s close at Rs 88.68. The currency briefly touched Rs 88.83 in early trade and accelerated its fall after breaching the 88.80 threshold, a level previously supported by Reserve Bank of India (RBI) interventions. Traders said the rupee’s slide accelerated after it broke past the long-defended 88.80 level, with the Reserve Bank of India appearing to scale back its recent interventions. Later, the currency was trading 1% lower against the US dollar at Rs 89.61.
The currency tumbled on weakening risk sentiment and falling expectations of a US Federal Reserve rate cut post better than expected jobs reports continued to affect the emerging-market currencies.
Market participants reported a sharp rise in trading volumes once the 88.80 support level was breached, reflecting heightened activity as the rupee weakened further on the interbank order-matching platform.
Persistent demand for dollars from importers and limited supply from exporters further contributed to the downward momentum. Since late August, when the United States imposed steep tariffs on Indian exports, foreign investors have withdrawn $16.5 billion from Indian equities, positioning the rupee as one of the weakest Asian currencies in 2025.
Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities expects more weakness in the Indian currency.
“Rupee dropped sharply to a new all-time low of 89.71, falling by 103 paise as the absence of any clear communication or progress on the India–US trade deal triggered strong selling pressure. With no visibility on tariff rollback or trade-related assurances, sentiment remained weak, leading to a broad risk-off move in the rupee. Near-term weakness can extend further, with the rupee likely to trade in the 89.20–90.00 range” said Trivedi.
Meanwhile, Sensex fell 400.76 points to 85,231.92 and Nifty50 dropped 124 points to close the session at 26,068.15. The India VIX , Indian market’s volatility index, surged 12.27% to 13.63 against its previous close of 12.14.
