Rupee slumps 25 paise to close at all-time low of 90.74 against U.S. dollar

The Indian rupee depreciated further on Monday, December 15, 2025, reaching a new record low against the U.S. dollar. The currency closed at 90.74, a fall of 25 paise from its previous closing value, after initially plummeting to 90.80 during the day.

Several factors contributed to the rupee's decline. Uncertainty surrounding a potential trade agreement between India and the United States weighed heavily on the currency. In addition, continuous outflows of foreign investment further exacerbated the situation, according to forex traders. Risk-averse sentiment in the market and strong demand for U.S. dollars from Indian importers also dampened investor confidence.

At the interbank foreign exchange market, the rupee commenced trading at 90.53 against the dollar. It then weakened, hitting an intra-day low of 90.80, representing a 31-paise drop. The rupee ultimately settled at 90.74.

On Friday, December 12, 2025, the rupee had already reached a then-record low, closing at 90.49 against the dollar after slipping 17 paise.

Dilip Parmar, a Research Analyst at HDFC Securities, observed that the rupee's performance made it the weakest among Asian currencies. He stated that the rupee's inability to gain ground, despite positive trade balance figures, was due to a significant imbalance between dollar supply and demand. High dollar demand from importers and consistent capital outflows were the primary drivers of this imbalance and remain major concerns for the currency.

Parmar added a technical perspective, noting a bullish bias for the USD-INR pair, with key resistance at 90.95 and support at 90.50 in the short term.

Meanwhile, Commerce Secretary Rajesh Agrawal indicated that India and the U.S. are making significant progress toward a framework trade deal. "We are very close on the framework deal, which we feel can be done in a short period of time. But I would not like to put a time period on that," Agrawal told reporters. Negotiations are proceeding on two fronts: a framework trade deal addressing high tariffs and a more comprehensive bilateral trade agreement.

Indian industry and exporters are keenly awaiting the outcome of these negotiations, as high import duties are negatively impacting their exports to the U.S. India and the U.S. had concluded two days of discussions on trade-related matters on Thursday, December 11, 2025.

Prime Minister Narendra Modi and U.S. President Donald Trump spoke by phone on Thursday, discussing ways to maintain momentum in the bilateral economic partnership, amidst positive signals regarding the trade deal.

Globally, the dollar index, which measures the dollar's strength against other major currencies, was down 0.08% at 98.32. Brent crude, the global oil benchmark, saw a 0.21% increase, trading at $61.25 per barrel.

In the Indian equity market, the Sensex declined by 54.30 points to close at 85,213.36, while the Nifty fell by 19.65 points to 26,027.30. Foreign Institutional Investors (FIIs) sold Rs 1,114.22 crore worth of equities on Friday, according to exchange data.

India's foreign exchange reserves increased by $1.033 billion to $687.26 billion during the week ending December 5, according to the RBI. The previous week had seen a decrease of $1.877 billion.