Rupee falls to all-time low of 90.52 against US dollar:Value depreciates 5% this year; find here what determines a currency’s value

The rupee on Friday, December 12, 2025, has fallen to its lowest level ever against the US dollar. According to PTI, the rupee fell 20 paise against the dollar to reach 90.52. Continuous withdrawal of foreign funds has put pressure on the rupee. The rupee has weakened by 5.5% so far in 2025. On January 1, the Indian currency was at 85.70 against the dollar, which has now fallen to 90.52. Rupee depreciation will make imports expensive The fall in rupee means that importing things will become expensive for India. Additionally, traveling and studying abroad has also become more expensive.
Suppose when the value of rupee against dollar was 50, Indian students in America used to get $1 for 50. Now students will have to spend 90.52 for $1. This will make everything from fees to living expenses and other things more expensive for students. Three reasons for the fall in rupee RBI’s intervention has been much less this time: LKP Securities VP Research Analyst Jatin Trivedi said, The main reason for rupee crossing 90 is that there is no concrete news about India-US trade deal and the timeline keeps getting delayed. That’s why the rupee has seen sharp selling in the last few weeks. Trivedi further explained that record high prices of metals and gold have increased the import bill. High US tariffs have hurt the competitiveness of Indian exports. He said, RBI’s intervention has also been quite limited this time, which accelerated the decline. How is currency value determined? When any currency’s value decreases compared to the dollar, it’s called currency depreciation. Every country has foreign currency reserves, which it uses for international transactions. Changes in foreign reserves affect the currency’s 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. ​