On Tuesday, the Indian rupee slipped further, hitting a record low of 91.05 against the US dollar in early trading. This marks the first time the rupee has breached the 91 mark, underscoring ongoing pressure on the domestic currency. The rupee’s decline follows its previous session’s record low close. On Monday, it provisionally ended at 90.74 against the US dollar, dropping 25 paise from the prior close.
Key highlights
Rupee falls below INR 91 against the US dollar. The Indian rupee slipped past the INR 91 mark, weighed down by heavy selling from foreign investors and growing global uncertainty. Foreign fund outflows continue Persistent outflows, partly linked to US–India trade tensions, are putting pressure on the rupee’s performance.
FIIs remain net sellers, This month, foreign investors sold Indian equities worth around INR 21,074 crore, staying net sellers across all trading sessions, adding to the downward pressure on the currency. Trade deficit narrows but rupee remains under pressure, despite better-than-expected trade data, the rupee failed to recover as overall capital outflows continued to weigh on sentiment.
Also read: Indian Economy Outlook: Poised for a Robust Quarter
Merchandise trade deficit drops. India’s merchandise trade deficit fell sharply to $24.53 billion in November, down from $41.68 billion in October, signalling a strong improvement in trade balance.
Exports continue to grow, Goods exports rose 19% year-on-year in November, largely supported by a 22.6% increase in shipments to the US, reflecting robust demand from key markets.
Cooling US labor market keeps Federal Reserve rate-cut expectations alive, influencing global currency dynamics. Immediate support seen near 90.06 and 90.00, while sustained strength could push USD-INR levels toward 92.00.
