Rupee hits all-time low of 90.42 against the dollar following US Fed rate cut

December 11, 2025

New Delhi: The rupee weakened to a fresh record low of ₹90.42 per US dollar on Thursday, as sustained dollar demand from corporates and lenders overshadowed the brief optimism following the US Federal Reserve’s rate cut.

Dollar Demand Outweighs Global Cues
Though the Fed’s less-hawkish outlook initially pressured the dollar, heavy dollar buying by foreign and private banks—mostly for corporate payments—kept the rupee under pressure. Traders said dollar outflows continue to dominate market sentiment.

On Track for Worst Year Since 2022
The rupee is heading toward its steepest annual fall since 2022, weighed down by volatile foreign flows and rising US trade tariffs on Indian goods. Analysts warn that failure to strike an understanding with Washington may deepen future losses.

RBI Swap Eyed for Stability
Markets are now looking at the RBI’s upcoming $5 billion dollar-rupee swap, expected to add liquidity to the banking system and help calm short-term volatility. Strong participation is anticipated.

Sitharaman: ‘Rupee Will Find Its Own Level’
Finance minister Nirmala Sitharaman cautioned against politicising the currency slide, stating that exchange rates should be assessed in the context of India’s economic strength. She emphasised that the rupee will stabilise based on fundamentals.