The Indian Rupee (INR) has been under significant pressure recently, achieving a record low against the US Dollar, reaching 88.62 on September 23, 2025. This decline has been primarily attributed to heightened US H-1B visa fees and diminishing foreign equity inflows. Analysts note that ongoing geopolitical tensions and strict immigration policies from the US have further compounded challenges for the INR.
To combat this downturn, the Reserve Bank of India (RBI) took proactive measures by increasing its short dollar forward positions by $6 billion in October, indicating a concerted effort to stabilize the currency. This intervention reflects concerns over persistent importer demand for dollars, which has dominated the market. Importers, wary of potential US tariffs and immigration regulations, have been hedging their positions to mitigate financial risks, thus exerting continued pressure on the rupee.
Economic reports from early November highlight further concerns, pointing to weak manufacturing exports and a narrowing policy rate differential between India and the US as factors likely to sustain pressure on the INR. The current economic landscape presents challenges, particularly as slower foreign direct investment is contributing to a less favorable outlook.
Market data indicates that the INR to USD exchange rate is currently at 0.011292, slightly below its three-month average, which has shown stability within a 2.1% range. In contrast, the INR to Euro has risen modestly to 0.009751, just above its average. The INR has seen more significant gains against the British pound, currently at 0.008590, which is 1.4% above its average. Notably, the INR to JPY has reached a 90-day high of 1.7568, reflecting positive movements in this pairing.
Overall, the outlook for the Indian Rupee remains cautious as it navigates through these economic and geopolitical hurdles, and market participants should remain vigilant to these developments when making international transactions.
