The Indian rupee has fallen to a record low of ₹90 against the US dollar, raising concerns across financial markets and leaving the Reserve Bank of India (RBI) in a difficult position over whether to intervene or allow market forces to dictate the currency’s movement.
The sharp slide follows persistent foreign investor outflows, strong dollar demand from importers, and limited RBI intervention. Dealers suggest the central bank has relied on exchange-based measures that have not been sufficient to stabilize liquidity.
While the rupee’s annual depreciation of around 5 percent remains within historical averages, the sudden breach of the 90-mark has unsettled traders and importers, increasing costs for essential goods and services.
The RBI now faces a policy dilemma: intervening strongly could deplete forex reserves, while allowing further depreciation risks inflationary pressures. The upcoming Monetary Policy Committee meeting is expected to provide clarity on the central bank’s stance.
