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The Indian rupee breached the 91-per-dollar mark amid heavy foreign investor selling, rising global trade tensions, and a strong US dollar. Experts warn further weakness unless RBI intervention stabilizes the currency.
Rupee Slips Past 91/$ for the second time in two months
New Delhi: The Indian rupee fell sharply breaching the psychological level of 91/USD once again due to a combination of global and domestic factors. Persistent selling by foreign portfolio investors, strong USD and uncertainty over the US-India trade deal are major factors for the rupee's slide.
The Indian rupee weakened sharply and crossed the important 91-per-dollar mark for the first time in 2026. The currency opened slightly lower at ₹90.93 per US dollar, compared to its previous close (Monday) of ₹90.90. As the day progressed, the rupee slipped further to an intraday low of ₹91.01, showing continued pressure.
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According to experts, one of the main reasons behind the rupee’s fall is heavy selling by foreign portfolio investors (FPIs). Foreign investors have been pulling money out of Indian stock markets for several months.
In just the first few weeks of 2026, FPIs have sold Indian equities worth more than ₹29,315 crore, which is roughly $3 billion. This large outflow has increased demand for dollars and weakened the rupee.
Due to this, foreign investors are moving towards safe havens like gold and silver. Moreover, Donald Trump's fresh threats of imposing tariffs on the EU over Greenland's issue have further intensified pressure on the investors to sell off their reserves.
This has pushed markets into a “risk-off” mode, where investors move money away from risky assets like emerging market currencies and into safer options such as gold, silver, and US government bonds.
The US dollar has gained strength due to a stable American labor market. Recent data shows that the US economy added around 50,000 jobs in December 2025, while the unemployment rate fell to 4.4%.
However, the statistics for the current month might be lower than the previous month, but the market trends show how investors are keeping up their trust for the US dollar against other currencies.
Because of this strength, markets believe the US Federal Reserve may keep interest rates high for a longer period. Higher US interest rates make the dollar more attractive, putting further pressure on the rupee.
Currency experts say the rupee is facing a “perfect storm” of both domestic and international challenges. According to analysts, if the rupee stays above the 91 level, it could weaken further unless the Reserve Bank of India (RBI) steps in to support it.
However, the RBI appears to be allowing the currency to adjust naturally while intervening only to control sharp volatility.
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The rupee’s weakness in 2026 is a continuation of its poor performance in 2025, when it fell nearly 6% and crossed ₹90 per dollar for the first time. Last year also saw record foreign investor outflows of ₹1.66 trillion.
In just the first 20 days of 2026, the rupee has already fallen by about 1.1%, showing that pressure remains strong.
