FX.co ★ Rupee Breaks Below Key 90 Mark

The Indian rupee has slid past the significant threshold of 90 per USD, continuing its trajectory to reach a new record low. This depreciation is fueled by sluggish trade and investment flows, alongside ongoing uncertainty over a potential trade agreement with Washington. The rupee stands out as one of Asia's weakest currencies this year, declining by 5% against the US dollar, marking its steepest annual drop since 2022. This downward trend is exacerbated by hefty US tariffs, as high as 50%, on Indian exports, which have dampened foreign investor interest in Indian stocks and hindered exports to the nation's largest market. Despite robust third-quarter GDP figures, the rupee remains under pressure, further strained by an expanding current account deficit. Market focus now shifts to the Reserve Bank of India's forthcoming policy meeting on December 5. At this event, the majority of economists anticipate a 25-basis point reduction in the repo rate, with expectations of maintaining this rate through 2026, given that inflation has remained comfortably below the 2%–6% target range in recent months. However, some experts suggest that the strong GDP results might justify maintaining the current rates.