The rupee slipped past the psychologically important 91-per-dollar level on Tuesday, January 20, extending its recent weakness amid heavy foreign fund outflows and rising global trade tensions.
The currency opened 2 paise lower at 90.93 per $, compared with Monday’s close of 90.90. Selling pressure intensified through the session, pushing the rupee to an intraday low of 91.01 against the US currency.
This marks a fresh setback for the rupee, which had already depreciated by 12 paise on Monday to end just shy of its record low closing level. The currency had earlier touched its weakest intraday level of 91.14 on December 16, 2025, while its lowest closing level stood at 90.93.
Forex market participants attribute the latest slide to a combination of global risk aversion and sustained capital outflows from Indian equities.
Renewed tariff threats by US President Donald Trump, this time directed at European nations amid a dispute over Greenland, have rattled global markets. The escalation has triggered a broad “risk-off” sentiment, prompting investors to move away from emerging market assets towards traditional safe havens.
An analyst pointed out that global markets are reacting nervously to developments in the US. He noted that an impending US Supreme Court decision on the legality of Trump-era tariffs has added to uncertainty, pushing investors towards assets such as gold and silver.
Foreign portfolio investor selling has emerged as a serious pressure point for the rupee. FPIs have remained net sellers of Indian equities for several months. So far in 2026, they have sold shares worth more than ₹29,300 crore, or roughly $3 billion. The persistent outflows have placed the rupee among the weakest major currencies in Asia this year.
Another analyst said continued global uncertainty and a sustained break above the 91 level could open the door for further depreciation, unless the Reserve Bank of India steps in aggressively. He added that any short-term correction may find support around the 90.30–90.50 range.
The latest move extends a difficult trend for the rupee. In 2025, the currency fell by about 6 percent, breaching the ₹90 mark for the first time amid record FPI outflows of ₹166 lakh-crore. In the first 20 days of January alone, the rupee has already weakened by nearly 1.1 percent, highlighting the challenges posed by volatile global conditions and shifting capital flows.