New Delhi: The Indian rupee plummeted to an all-time low of 90.74 against the US dollar on December 15, 2025, closing 25 paise weaker than its previous value, according to PTI. The currency has lost nearly 6% of its value in 2025, sliding from 85.72 on January 1 to the current historic low.
A weaker rupee directly impacts the cost of imports, making goods from abroad more expensive. It also raises the cost of studying and travelling overseas. For instance, when the rupee stood at 50 against the dollar, 50 rupees would buy 1 dollar. Now, with the rupee at 90.74, the same dollar costs nearly double in rupee terms, affecting everyday expenses for Indians.
Reasons Behind the Depreciation
One major factor behind the rupee’s decline is the imposition of a 50% tariff on Indian imports by US President Donald Trump. Analysts estimate that this move could reduce India’s GDP growth by 60-80 basis points and increase the fiscal deficit, putting pressure on the country’s foreign exchange reserves. Reduced exports and slower foreign currency inflows are further weakening the rupee.
Another significant contributor is the continuous withdrawal of foreign funds. Since July 2025, Foreign Institutional Investors (FIIs) have sold Indian assets worth over Rs 1.55 lakh crore, primarily due to concerns regarding US trade tariffs and global economic uncertainty. This has led to a higher demand for dollars, further pushing the rupee down.
Impact on the Economy
The depreciating rupee affects both businesses and consumers. Importers face higher costs, which may translate to increased prices of goods and services in India. Similarly, students and travellers planning trips abroad will encounter a heavier financial burden.
Economists warn that unless trade tensions ease and foreign investments stabilize, the rupee could remain under pressure in the coming months. The government and the Reserve Bank of India are monitoring the situation closely to maintain currency stability.
