Rupee hits new low at 90.56 amid dollar demand, tariff concerns

The rupee hit a new all-time closing low at 90.41 against the dollar Friday due to strong dollar demand from importers amid rising global precious metal prices. The currency touched a record intraday low of 90.56 against the greenback.

The absence of the India-US trade deal and levy of a protectionist tariff by Mexico on India and other countries that do not have a free trade agreement with it weighed on the sentiment while foreign investors continued withdrawing money from local markets, forex dealers said. The Mexican tariff of 5-50% will be effective from January 1, 2026.

The local currency opened weaker at 90.43 against the dollar as compared with the previous close of 90.32, and lost further ground to the intra-day low on steady dollar demand from importers. It settled at 90.41 Friday to mark the third daily fall in a row.


This marked an around 1% depreciation in December alone while the currency weakened nearly 6% this year so far, making it the worst performing among Asian peers.

Foreign portfolio investors withdrew a net $204.87 million from the equity market Friday taking the total net outflow to $1.996 billion in December so far, data from NSDL showed.

India's foreign exchange reserves, meanwhile, rose $1.033 billion in the week ending December 5 to $687.260 billion, the Reserve Bank of India data showed.

This is largely on account of a rise in gold reserves while foreign currency assets declined in sync with the dollar outflows. The reserves held in gold increased $1.188 billion in the reporting week to $106.984 billion. Foreign currency assets were lower by $151 million to $556.880 billion.