The Indian Rupee (INR) is currently facing significant pressure, having recently reached a record low of 88.36 per U.S. dollar on September 5, 2025. This depreciation has been attributed to rising concerns over new U.S. tariffs on Indian exports and continued foreign portfolio outflows, which exceeded $1.4 billion in September alone. The total capital outflow for the year has crossed $16 billion, exacerbating the downward trend of the INR.
In response to this sharp decline, the Reserve Bank of India (RBI) intervened strategically, selling dollars through state-run banks to moderate the rupee's depreciation around the critical level of 88.30. Analysts suggest that while the pain for the rupee has been severe, intervention measures may help stabilize the currency in the near term. A Reuters poll from early September indicates that the INR is expected to hover around 88.04 by the end of the month and stabilize around 88.00 within the next year.
Market conditions reflect ongoing volatility. The INR to USD exchange rate at 0.011351 is currently 1.2% below its three-month average, operating within a stable range. Conversely, against the Euro, pound, and yen, the INR is witnessing relative strength, marking recent 7-day and 14-day highs, although still slightly below their respective three-month averages.
Overall, while the INR is grappling with external pressures from tariffs and outflows, short-term forecasts offer some optimism for stabilization. Individuals and businesses engaging in international transactions may want to consider these trends to optimize their currency exchange strategies in a challenging forex landscape.
