Rupee Hits Record Low Beyond 90: Weak FPI Flows, High Crude & Trade Uncertainty Drag Currency Down

The Indian rupee crashed to a new lifetime low on Wednesday, breaching the crucial 90-per-dollar mark as persistent foreign portfolio outflows, elevated crude oil prices, and uncertainty surrounding the India–US trade deal triggered fresh pressure on the currency. The sharp slide also highlights the rupee’s poor performance in 2025, with the currency losing nearly 4–5% so far — making it one of Asia’s weakest performers this year.

Export-Focused Sectors Stand to Gain

Analysts say the depreciation could benefit several export-oriented industries. According to Sunny Agrawal, Head of Fundamental Research at SBI Securities, sectors such as shrimp, textiles, IT services, pharmaceuticals, metals, engineering goods and automobiles may see improved global competitiveness as the rupee weakens.

However, he cautioned that businesses reliant on imported inputs — including FMCG companies, plastic polymer manufacturers, and oil & gas players — are likely to face intensified cost pressures.

Import Demand Absorbing Dollar Liquidity

Anindya Banerjee, Head of Commodity and Currency at Kotak Securities, noted that steady dollar demand from import-heavy sectors like oil, metals, and electronics continues to absorb available liquidity, preventing any meaningful recovery.

He emphasised that despite the rupee hitting a new low, the market remains largely orderly. “The RBI is stepping in only to smooth volatility, not to protect any specific level,” he said.

Also Read: Indian Stock Indices Decline As Rupee Crashes Past 90 vs USD: What’s Driving The Sell-Off? | Republic World

High Global Metal Prices Add to Stress

Jateen Trivedi, VP & Research Analyst at LKP Securities, said soaring global metal and bullion prices have further inflated India’s import bill. Combined with steep US tariffs, this has strained export competitiveness and kept market sentiment weak.

Import-heavy segments such as mineral fuels, machinery, electrical equipment and gemstones remain under pressure, he added. Trivedi also pointed out that the rupee is “deeply oversold”, with a move above ₹89.80 required to signal any meaningful rebound.

Government Says No Macroeconomic Stress

India’s Chief Economic Advisor, V. Anantha Nageswaran, played down concerns over the currency’s slide past 90, saying the movement remains within “manageable limits”.

“I’m not losing sleep over it,” he remarked at a CII summit, stressing that the depreciation has not fuelled inflation or hurt export momentum. “Right now, it’s not hurting our exports or inflation,” he said. (with inputs from ANI)