The rupee on Wednesday, slipping to 90.11 in early trade to hit an all-time low. The move shocked traders despite weeks of mounting pressure on the currency from global and domestic factors.
Foreign investors have continued to pull out money from Indian markets, the dollar has strengthened globally, and uncertainty around the India–US trade deal has weighed heavily on sentiment.
Together, they created the perfect setup for the rupee to crack past a level the market had been nervously watching.
Commodity markets have added another layer of strain. Record-high metal and bullion prices have pushed up India’s import bill just as export competitiveness has weakened due to steep US tariffs and slowing global demand.
Jateen Trivedi, VP Research Analyst for Commodity and Currency at LKP Securities, said the breach was the result of several converging pressures.
“, pressured by the absence of a confirmed India–US trade deal and repeated delays in timelines. Markets now want concrete numbers rather than broad assurances, leading to accelerated selling in the rupee over the past few weeks,” he said.
He added that elevated commodity prices have hurt sentiment further.
“Record-high metal and bullion prices have worsened India’s import bill, while steep US tariffs continue to strain export competitiveness. This has kept weakened sentiment across equities compared to global markets and import-heavy sectors such as mineral fuels, machinery, electrical equipment and gemstones,” Trivedi said.
Trivedi also noted the market is waiting for a clearer signal from the Reserve Bank of India. “Muted RBI intervention has contributed to the swift depreciation.
With the RBI policy announcement on Friday, markets expect clarity on whether the central bank will step in to stabilise the currency. Technically, the rupee is deeply oversold, and a move back above 89.80 is essential for any meaningful recovery.”
The immediate worry now is whether the rupee stabilises above 90 or slips further. Import-heavy sectors may face higher costs almost immediately, while consumers will feel the impact once fuel, electronics and essential imports adjust to the weaker currency.
The next cues will come from Friday’s RBI policy statement, the US Federal Reserve’s commentary and any concrete movement on the long-pending India–US trade discussions.
Until then, analysts expect the rupee to remain volatile and sensitive to even small shifts in global sentiment.