Indian rupee slumps to record low against dollar as foreign investors flee

The Indian rupee on Wednesday weakened to a fresh record low, slipping 6 paise to trade at 91.19 against the US dollar in early deals, reported Indian media.

The Indian currency came under pressure due to strong dollar demand from metal importers and continued foreign portfolio investor (FPI) outflows. A weak tone in domestic equity markets further weighed on sentiment.

The rupee opened at 91.08 against the US dollar. The Indian currency fell about 0.24% to a record low of 91.19.

The USD/INR jumps to near 91.58 as the Indian rupee faces intense selling pressure due to consistent outflow of foreign funds from the Indian stock market and the risk-off market mood amid tensions between the US and the European Union (EU) over Greenland.

Foreign Institutional Investors (FIIs) are consistently dumping their stake in the Indian stock market due to the absence of a trade deal announcement between the US and India, keeping demand for US dollars sustained among Indian importers. So far in January, FIIs have remained net sellers in 12 out of 13 trading days and have offloaded their stake worth Rs32,253.55 crore.

Consistent outflow of overseas funds from the Indian equity market is weighing heavily on Indian bourses. Nifty50 is down almost 4.3% to near 25,250 from its highest level of 26,373 recorded on January 5.
Trade tensions between the US and India were caused by the imposition of 25% punitive tariffs in mid 2025 by Washington on imports from New Delhi for buying oil from Russia.