In a significant development for the Indian economy, the rupee has breached a critical psychological barrier, falling below the 90-mark against the US dollar for the first time ever. This milestone underscores a period of intense pressure on the domestic currency in the global foreign exchange markets.
A Steep and Unprecedented Decline
The rupee's slide past the 90 per dollar level represents its sharpest decline in value since the turbulent year of 2022. So far in the calendar year 2025, the currency has depreciated by a substantial 5.3% against the greenback. This performance has unfortunately earned the rupee the tag of Asia's worst-performing currency for the year to date, highlighting the scale of the challenge.
Understanding the Market Dynamics
While the original report, filed by Gyanendra Keshri and last updated on 03 December 2025 at 21:25 IST, confirms the event, it points to broader global and domestic factors at play. Typically, such a sharp fall is driven by a combination of strong demand for the US dollar from importers and corporates, alongside foreign portfolio outflows. Global risk-off sentiment, where investors seek safe-haven assets like the dollar, often exacerbates the pressure on emerging market currencies like the rupee.
Implications and the Road Ahead
This depreciation carries several consequences. A weaker rupee makes imports, particularly crude oil and electronics, more expensive, potentially fueling domestic inflation. It also increases the burden for Indian companies with foreign currency debt. However, it can provide a boost to export-oriented sectors by making their goods more competitive internationally. The Reserve Bank of India (RBI) likely monitors the situation closely, as a disorderly fall could prompt intervention to stabilize the currency. Market participants will now watch for policy responses and global cues that could determine the rupee's trajectory in the coming weeks.
