Mumbai: The Indian rupee hit a historic low of 91.9650 against the US dollar on Friday, capping its steepest weekly plunge in six months as foreign investors fled equities and importers ramped up hedging. It closed at 91.94, down 0.34% for the day, 1.18% for the week, and 2.3% for the month, defying gains in most Asian peers against a softening dollar index.
Persistent foreign portfolio investor outflows, totalling nearly $3.5 billion from Indian equities in January —following $18 billion last year — increased the pressure. Importers and corporates boosted dollar hedging amid fears of further weakness, while exporters curbed forward sales, cutting supply.
Gold imports and speculative offshore bets added to dollar demand despite positive Asian cues.
The Reserve Bank of India (RBI) intervened aggressively by selling dollars in spot markets on at least two days and using buy/sell swaps to manage liquidity impacts. Despite these efforts, the Nifty 50 index slumped 2.5% weekly, complicating stabilisation amid US tariff threats up to 50% on Indian exports and simmering geopolitical tensions.
Traders warn of vulnerability near 92.00, with one-month non-deliverable forwards signalling more downside.
Kunal Kurani of Mecklai Financial Services noted the rupee’s pressure persists “irrespective of broader market signals,” echoing 2025 trends.
The slide coincides with global jitters from US President Donald Trump’s threat to annexe Greenland, which he subsequently toned down, fueling safe-haven flows.
