Rupee Hits Record Low Against USD

The Indian rupee slipped to a new all-time low of 89.79 against the U.S. dollar during intraday trading on Monday, December 1, 2025. This depreciation of 34 paise was driven by several factors including a weak domestic equity market, continued foreign fund outflows, and strong demand for the dollar from importers.

At the interbank foreign exchange market, the rupee began the day at 89.45 before declining steadily to its record low. The currency has been on a downward trajectory in recent weeks, after falling 9 paise to 89.45 on November 28 and plunging nearly one rupee on November 21 to 89.66, which was then the lifetime low.

Market observers highlight that foreign portfolio investors (FPIs) have been selling stakes in various Indian companies, influenced by high valuations and market uncertainties. This has led to considerable outflows putting pressure on the rupee. Additional factors impacting the currency include increased purchases of oil and gold, and repayments by corporate and central government entities.

External pressures also affected the rupee's performance. The U.S. dollar remained strong overall, supported by its recent 0.04% gain on the dollar index, which tracks the greenback against a basket of other currencies. Rising international crude oil prices also weighed on the rupee, with Brent crude futures rising nearly 2% to $63.60 a barrel, increasing India’s import costs and demand for dollars.

Trade tensions with the U.S. persist, adding uncertainty to the currency markets. India is hopeful for a trade deal framework to address tariffs in the near future, which could provide some relief to exporters.

Domestically, equity markets mirrored the cautious sentiment, with both the Sensex and Nifty indices declining from record highs by midday. FPIs sold equities worth nearly ₹3,800 crore on November 28, continuing the trend of foreign fund outflows that has affected the rupee’s stability.