Rupee dips to 93.73 against USD; worst single-day drop in 4 years

New Delhi: The Indian rupee slumped to a new record low of 93.73 against the US dollar on Friday, weighed down by persistent foreign fund outflows and a steep rise in crude oil prices amid an escalating West Asia conflict.

Eclipsing its previous record low of 92.63 touched on Wednesday, the rupee started the Friday trading at the interbank foreign exchange, at 92.92, and soon slipped below the 93-mark. The local currency depreciated further, slipping to a record low of 93.7350 against the greenback.

With over 1% depreciation, the rupee recorded its worst single-day drop in four years. Analysts said the Indian currency may depreciate further as continued disruption in the global supply chain due to the West Asia conflict is likely to widen the country’s import bills.

RUPEE VS DOLLAR. PTI GRAPHICS.

“Markets aggressively priced in the negative impact of elevated crude prices. Sustained strength in crude is expected to significantly widen India’s import bill, putting continued pressure on the domestic currency,” said Jateen Trivedi, Vice-President at LKP Securities.

“The macro environment remains unfavourable for the rupee, with higher energy costs and persistent dollar demand weighing on sentiment. Unless crude prices ease meaningfully, the rupee is likely to stay under pressure,” he said.

Trivedi added that in the near-term, the rupee is
expected to trade in a weaker range of 93.00-94.25 against the US dollar.

The rupee has depreciated nearly 8% against the dollar in the past one year. It has declined by over 3% so far in 2026. The Indian currency has also weakened sharply against the other major global currencies like euro, the British pound, and the Chinese yuan.

Heavy outflow of money from the Indian equity markets has hit the rupee. Foreign Institutional Investors pulled out $1.45 billion from the Indian markets on Friday, taking the total outflows in the 2026 calendar year so far to $10.3 billion. In FY2025-26 so far, total FII outflows stand at $14.3 billion.

The Indian currency continues to weaken despite frequent interventions by the RBI. India’s foreign exchange (forex) reserves declined by nearly $18 billion in the first two weeks of March, due to likely selling of dollars by the RBI to support the local currency.

The forex reserves declined by $7.05 billion to $709.76 billion for the week ending March 13, as per the latest RBI data. In the previous week, it had fallen by $11.68 billion.