Indian Rupee Nears Key 90 Per Dollar Mark as Trade Impasse Bites

The Indian rupee has tested a series of record lows this year, and some analysts warn it could slip to the psychologically key 90-per-dollar level if a crucial trade deal with the US doesn’t materialize soon.

The currency hit a new all-time low of 89.8537 on Tuesday, as delays in finalizing the trade accord with Washington to lower one of the harshest tariffs in Asia hurt sentiment. In the offshore market, the rupee weakened further to 90.05.

India remains among the last major economies yet to sign a trade pact with the US, even as officials express optimism about concluding one soon. The delay has contributed to a of the nation’s current account deficit in the September quarter, adding pressure on the currency.

“In case India isn’t able to reach a trade deal, then USD/INR could break 90 by December-end,” said Gaura Sen Gupta , chief economist at IDFC First Bank Ltd.

For now, the central bank may be allowing a bit more weakness in the rupee to make exports more competitive amid the US levies, said David Forrester , FX strategist at Credit Agricole.

The rupee has declined 4.6% this year, making it Asia’s worst-performing currency. Sustained weakness risks deterring foreign investors, who have pulled $16 billion from local shares this year, and could stoke inflation in the fuel-importing nation.

Although the Reserve Bank of India has dollar sales to smooth volatility, analysts say it may be reluctant to use too much of its reserves to prevent a break past the 90 level if no agreement is reached on the trade pact. Its interventions in recent weeks have been sporadic, in contrast to the dollar sales in October that supported the rupee around the 89 mark.

“If high tariffs stay, I don’t believe the RBI’s defense of 90 will be very strong,” said Dhiraj Nim , a foreign-exchange strategist at Australia and New Zealand Banking Group. He has revised his forecasts to expect a durable breach of the 90 level by the first quarter of 2026.