Rupee Plummets to Record Low Against Surging Dollar, Threatening India’s Economic Recovery

The Indian rupee breached the 91 threshold against the US dollar during Tuesday's trading session, marking its worst performance in a decade. This year's 6.8% depreciation against the greenback has positioned the rupee as Asia's weakest currency, with analysts warning of potential triple-digit exchange rates if the slide continues.

Equity markets mirrored the currency's distress, with the Sensex shedding 450 points and the Nifty dropping 150 points. Banking stocks bore the brunt—HDFC Bank, a bellwether for the sector, fell below the psychologically critical 1,000 INR level. The rupee's 20% decline over five years now threatens to derail post-pandemic recovery efforts, with import costs soaring and export competitiveness eroding.

Currency strategists note the rupee's descent has accelerated since January, when it traded at 85.93. The current trajectory suggests the Reserve Bank of India may soon face untenable intervention costs to stabilize the exchange rate.