Indian currency falls to record low on US trade delay and capital outflows
Indian rupee (illustrative photo: Getty Images)
India's national currency fell to a record low due to delays in the US trade deal and massive outflows of foreign funds, Bloomberg reports.
The record fall of the Indian rupee — down 0.4% to 91.3350 per dollar — is linked to a delay in the trade deal with the United States. The delay worsened investor sentiment and led to a large-scale outflow of funds from Indian equities abroad.
Overall, the rupee has been falling for six consecutive days. The Indian currency is performing the worst among Asian currencies.
"The rupee is getting hit by global uncertainties due to geopolitical developments, in addition to idiosyncratic issues like the US trade deal and capital outflows," said Madhavi Arora, lead economist at Emkay Global Financial Services Ltd.
Since the beginning of January, foreign investors have withdrawn $2.7 billion from Indian equities, compared with about $19 billion for all of 2025. Investors are alarmed by delays in concluding the trade deal with the United States and by a 50% US tariff on Indian goods, which has hit exporters hard.
The situation is so severe that, in recent sessions, the Reserve Bank of India has been forced to intervene and sell dollars to support the rupee. However, it can only soften the impact, not offset the pace of the national currency's decline.
India's state-owned refiner, Mangalore Refinery and Petrochemicals Ltd, is considering purchasing Venezuelan oil after halting imports of Russian crude due to Western sanctions.
Overall, India is now gradually reducing purchases of Russian crude oil due to fears of secondary US sanctions and is gradually seeking alternative markets. As a result, tankers carrying Russian oil are accumulating at sea in large numbers.
