Historic Low: Rupee's Downfall Amid Global Tensions

The Indian rupee plummeted to an all-time low against the US dollar, driven by persistent foreign fund outflows and geopolitical tensions. Particularly, the unresolved Greenland dispute and US control over Venezuela’s oil contribute to the turmoil. Despite the rupee's vulnerability, India's strong forex reserves offer some reassurance.

The Indian rupee experienced a significant drop, closing at a record low of 91.64 against the US dollar, due to ongoing foreign fund outflows and increasing global market uncertainties. This decline marks the most substantial single-day fall since November 2025 and reflects mounting geopolitical tensions, including the Greenland issue affecting US-Europe relations.

Forex traders reported the rupee's previous all-time low was 91.14 on December 16, 2025, highlighting its 1.50 percent decrease this month alone. Rising tensions in Europe over Greenland and potential tariffs, coupled with negative domestic market trends, further impacted investor morale.

Experts indicate that despite the rupee's depreciation, India's robust foreign exchange reserves could help stabilize the situation. The outcome of a pending trade agreement with the US remains pivotal for boosting investor confidence and bilateral trade, potentially mitigating the rupee's vulnerability to external shocks.

(With inputs from agencies.)