The Indian rupee continued its sharp decline on Wednesday, touching a historic low of ₹90.26 per US dollar, as uncertainty over the long-pending India–United States trade deal rattled financial markets. The currency slipped to ₹90.13/USD in early trade, breaching Tuesday’s previous record of 89.9475.
Global news agency AFP has already labelled the rupee among the “worst forex performers of 2025”, reflecting weakening sentiment as foreign investors pull back amid geopolitical and trade-related unease.
Analysts attribute the steep depreciation to sustained foreign fund outflows and the absence of clarity on the bilateral trade pact.
An AFP report quoted Dilip Parmar of HDFC Securities who said the rupee’s slide was “first and foremost an imbalance of demand and supply,” adding that trade deal delays have amplified the pressure.
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Another factor, experts say, is the cautious stance of the Reserve Bank of India. While the central bank has intervened several times this year through dollar sales, it has recently allowed more currency flexibility.
‘Every Day Without a Trade Deal Pushes USD/INR Higher’: HSBC
The US–India trade agreement remains a critical missing piece.
Joey Chew, Head of Asia FX Research at HSBC Singapore, told Reuters that continued delays are directly impacting the currency. “Every day that we do not have a trade deal, the FX demand from trade deficit and outflows keeps pushing USD/INR higher,” she was quoted as telling Reuters, adding, “Foreign investors are also losing patience… without new trade deal headlines, net flows have become flat.”
Her comments echo concerns across market circles that the rupee could fall further without decisive progress in negotiations.
Weak Rupee Not a Concern, Says Chief Economic Adviser
Despite the market alarm, Chief Economic Adviser V. Anantha Nageswaran downplayed the significance of the rupee’s drop.
Speaking at an event in Kolkata, he reportedly said he was “not losing sleep over the weakening rupee,” asserting that the fall would not impact inflation or exports. He also expressed confidence that Washington could soon reverse the extra tariff imposed on Indian goods.
“My personal confidence is that in the next couple of months… we will see a resolution to the extra penal tariff of 25%,” he said, adding that reciprocal tariffs may also ease to “10–15%.”
His remarks suggest that a breakthrough in negotiations could restore investor sentiment, though analysts warn that the currency remains vulnerable in the near term.
