The Indian rupee continued its weak streak after slight recovery in mid-day trade on Friday. The currency opened at 90.06/$, down 0.1% from Friday’s close of 89.98 against the US dollar. Last week, the currency slipped to lifetime lows below the 90-level.
Stalled US-India trade deal keeps Rupee under pressure
The recent depreciation is largely attributed to the lack of progress on a trade deal between the US and India, coupled with heavy selling of domestic equities by foreign investors.
According to provisional data of December 5 available on NSE, foreign institutional investors sold shares worth Rs 438.90 crore. “For India, the Fed’s stance will be crucial for rupee direction and FII flows. Though the currency may remain under near-term pressure, India’s macro fundamentals continue to stand out, supported by the RBI’s recent rate cut, resilient economic growth and improving domestic liquidity conditions,” said Ponmudi R, CEO of Enrich Money, in a note.
RBI Governor says no specific target level for the currency
Analysts expect the rupee to make a comeback to the 88–89 range against the US dollar by early 2026. Meanwhile, RBI Governor Sanjay Malhotra, in his address on Friday, reiterated that the central bank does not target any specific level for the currency. He added that the RBI allows the rupee to “find its correct position, its correct level.”