The Indian rupee has been hitting record lows against the US dollar, with the latest drop seeing it reach 85.27 (provisional) on Thursday. This marks the third consecutive session of weakness for the currency, attributed to a strong greenback and rising crude oil prices.
Forex traders have highlighted increased demand for the dollar from importers at the end of the month and year, as well as concerns over potential import tariffs imposed by the Trump administration. These factors have contributed to the rupee’s decline.
Anuj Choudhary, a Research Analyst at Mirae Asset Sharekhan, noted that the rupee’s fall can also be attributed to rising US treasury yields and mounting FII outflows. Additionally, the surge in crude oil prices has added pressure on the currency.
On the global front, the dollar index remains elevated at 107.93, despite trading marginally lower. This is due to soaring US Treasury yields and speculations of delayed interest rate cuts by the Federal Reserve. Brent crude oil prices have also risen to $73.99 per barrel in futures trade.
In the domestic market, the BSE Sensex closed almost flat at 78,472.48 points, while Nifty edged up by 22.55 points to close at 23,750.20 points. Foreign Institutional Investors (FIIs) were net sellers on Tuesday, offloading shares worth ₹2,454.21 crore.
Overall, the rupee’s depreciation against the US dollar reflects a combination of domestic and global factors influencing currency dynamics. Investors will be closely monitoring market developments to gauge the rupee’s trajectory in the coming days.
