Rupee plunges to all-time low against US dollar:Indian currency falls to 89.85 against greenback, sliding nearly 5% so far in 2025

The rupee on Tuesday, 2 December 2025 has reached its lowest level against the US dollar. During early trade, the rupee slumped 32 paise to all-time low of 89.85. The decline in domestic stock markets and continuous withdrawal of foreign funds have put pressure on the rupee. At the interbank foreign exchange, the rupee opened at 89.70 against the US dollar before dropping to record low level of 89.85 , down 32 paise from its previous close. On Monday, the rupee after sinking to 89.79 in intraday trade, settled at 89.53 against the US dollar. Rupee has weakened almost 5% so far in 2025 The Indian currency has weakened by 4.77% so far in 2025. On 1 January, the rupee was at 85.70 against the greenback, which has now reached the level of 89.85. Imports will become expensive due to rupee depreciation Why is the dollar pressure increasing on the rupee, what are the reasons? This decline in the rupee is linked to the global strength of the dollar. The dollar index rose 0.04% to reach 99.50. International crude oil prices also surged, with Brent crude futures trading at $63.60 per barrel, up 1.96%. Heavy dollar demand from importers also pushed the rupee lower. Foreign Portfolio Investors (FPIs) are selling company stakes due to high valuations, leading to outflows. Oil buying, gold buying and repayments from corporates and central government also added pressure. Trade tensions are causing obstacles in negotiations with the US. Tariff impositions by the Trump administration have made talks difficult. However, Commerce Secretary Rajesh Agarwal has said that a framework trade deal settlement is expected by the end of 2025, which will give tariff benefits to Indian exporters. Impact seen on market, Sensex-Nifty decline The decline in rupee also had a negative impact on domestic equity markets. On the second trading day of the week on Tuesday, December 2, 2025, the Sensex is trading at 85,350, down 300 points. Nifty is also down 80 points, trading at the level of 26,100. Experts said – Outflow increased concerns How is currency value determined? When any currency’s value decreases compared to the dollar, it is called currency falling, breaking, or weakening. In English, it is called currency depreciation. Every country has foreign currency reserves, which it uses for international transactions. The increase and decrease in foreign reserves affects the currency value. If India’s foreign reserves in dollars equal America’s rupee reserves, the rupee’s value will remain stable. If our dollar reserves decrease, the rupee will weaken; if they increase, the rupee will strengthen. This is called the floating rate system. ​