Mumbai, India – December 16, 2025 – The Indian Rupee plunged to a historic all-time low on Tuesday, breaching the psychological 91 mark against the US Dollar for the first time ever. The currency weakened sharply, touching an intra-day low of around 91.08-91.14 before closing provisionally near 91.01-91.07, down about 0.3% or 23-36 paise from the previous session.
This relentless decline in the Rupee vs USD exchange rate has been driven by persistent foreign institutional investor (FII) outflows exceeding $18 billion in 2025, coupled with uncertainty surrounding the delayed India-US trade deal. Traders report heightened dollar demand from importers and hedging activity, exacerbating the pressure despite occasional RBI interventions.
Experts point to the prolonged deadlock in US-India trade negotiations as a key factor dampening investor sentiment. Steep US tariffs on Indian exports have hurt trade prospects, reducing foreign appetite for Indian assets. Positive talks between leaders offer hope, but no breakthrough has materialized, leading to continued equity and bond sell-offs.
The Rupee’s weakness – down over 6% year-to-date and Asia’s worst performer in 2025 – is creating a vicious cycle: reduced FII attraction fuels more selling, further pressuring the currency. This impacts gold and silver prices, which have risen as safe-haven demand surges amid dollar strength and Rupee depreciation.
Commodity analysts note increased buying of precious metals both domestically and globally, as the falling Rupee makes imports costlier. The broader effects ripple through mutual funds, stock markets, and overall economic confidence.
While domestic institutional investors (DIIs) have absorbed much of the selling pressure, sustaining this long-term remains challenging. A potential trade deal resolution could trigger a sharp Rupee rebound and restore equity inflows.
Stay updated on the latest USD INR exchange rate, FII flows, and trade deal developments as markets watch for RBI actions and global cues.
