MUMBAI: The rupee plunged to a new record low on Friday, losing 20 paise to close at 92.45 against the US dollar. The dollar has been on a winning streak since the war on Iran began 13 days ago, while concerns over rising crude prices — which crossed $101 a barrel — have intensified amid the escalating West Asia conflict.
The rupee has been under pressure since last year, when it lost 4.9% against the dollar, making it the third-worst performing currency globally. In 2026, the currency has faced further stress as foreign investors continue to pull money out of Indian equities and debt markets. Foreign investors have withdrawn nearly $7 billion so far this year, following a record $18.9 billion outflow in 2025. With Friday’s decline, the rupee has fallen over 3.5% in 2026 so far.
Forex traders attributed the continued weakness to a stronger dollar, heavy foreign fund outflows, and sustained selling in domestic equity markets. Benchmark indices also suffered sharp losses on Friday, each falling more than 2%, further weighing on the rupee.
At the interbank foreign exchange market, the rupee opened at 92.37, down 12 paise from the previous close. It continued to weaken during the session, hitting an intra-day low of 92.47, before settling at a new lifetime closing low of 92.45 (provisional) — down 20 paise from the previous close.
On Thursday as well, the currency had plunged to 92.37, touching a fresh intra-day low and closing 24 paise lower at 92.25. The previous record low was 92.35 on March 9.
Traders also noted that rising retail inflation, which climbed to an 11-month high of 3.2%, driven by higher food prices, has added pressure on the rupee. Elevated oil prices have further worsened sentiment, particularly after the closure of the Strait of Hormuz, a key global shipping chokepoint.
“Oil prices remain elevated after Iran said the Strait of Hormuz will remain closed until the resolution of the war. The dollar index has also risen, while European and Asian currencies have weakened against the dollar,” said Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors.
He added that if the Reserve Bank of India (RBI) does not intervene, the rupee could test the 93 level sooner rather than later.
“The rupee’s new record-low closing is due to weak domestic markets and a strong dollar. Rising crude prices and continued FII outflows are also pressuring the currency,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan.
“We expect the rupee to trade with a negative bias amid global risk aversion as the Iran war escalates. Rising crude prices and inflation concerns may further pressure the rupee. A strong dollar and rising US Treasury yields may also weigh on the currency,” Choudhary added.
He expects the rupee to trade in the 92.10–92.80 range.
Meanwhile, the dollar index, which measures the greenback’s strength against a basket of six major currencies, was 0.43% higher at 100.17 on Friday.
Brent crude, the global oil benchmark, was trading 1.41% higher at $101.9 per barrel in futures trade.
In the domestic equity market, the Sensex plunged 1,470.50 points (1.93%) to 74,563.92, while the Nifty fell 488.05 points (2.06%) to 23,151.10.
According to exchange data, foreign institutional investors (FIIs) sold equities worth ₹7,050 crore on a net basis on Thursday.