Rupee slides to record low as global risk aversion and foreign selling weigh

The Indian rupee fell to a fresh record low against the US dollar on Tuesday, coming under renewed pressure from global risk aversion, sustained foreign investor outflows and weakness in domestic equity markets.

The currency touched an intraday low of 91.7450 to the dollar in afternoon trade before recovering slightly. By mid-afternoon it was trading near 91.68, after opening at 91.08 compared with the previous close of 90.98.

Currency analysts said the slide was driven by a combination of geopolitical tensions linked to the dispute over Greenland, a sell-off in Japanese bonds and a broader “risk-off” mood across global markets. The rupee’s fall marked its sharpest single-day decline in around three months.

Anil Kumar Bhansali, head of treasury at Finrex Treasury Advisors, told Moneycontrol that the currency had weakened as equity markets extended losses for a sixth consecutive session. He added that the rupee was now the second worst-performing Asian currency so far in 2026, with a decline of nearly 2 per cent.

Foreign portfolio investors have sold around Rs 33,000 crore of Indian equities so far this month, with net outflows recorded on 12 trading days.

Bhansali said delays in an India–US trade agreement, higher American tariffs on Indian exports and strong dollar demand from importers, particularly those linked to precious metals, had compounded the pressure on the currency.

Indian share markets also remained volatile. The benchmark Sensex and Nifty indices extended losses on Wednesday after a sharp sell-off in the previous session, tracking weak global cues and rising geopolitical concerns.

In early trading, the Sensex dropped more than 1,050 points to an intraday low of 81,124, while the Nifty slid below the 25,000 mark for the first time in over four months. Although a brief rebound pushed both indices into positive territory, selling pressure returned later in the session, with the Sensex shedding around 500 points from its day’s high and the Nifty slipping back below 25,150.

Analysts said continued foreign selling, global uncertainty and concerns over trade and tariffs were likely to keep both the rupee and equity markets under pressure in the near term.