Rupee Slips Past 90 Against Dollar as Markets Brace for Volatile December

The Indian rupee’s slide past the ninety mark against the United States dollar has sent a ripple across financial markets this week. Traders were expecting a weak close to the year, but many said the pace of the fall caught them off guard. The moment the currency breached ninety, it felt like a psychological wall had cracked. And once that kind of wall breaks, it rarely goes back quickly.

Early Wednesday morning, dealers across Mumbai’s currency markets were glued to their screens as the rupee opened sharply lower. Within minutes, it settled around 90.12 per dollar. The room fell quiet for a second before the usual chatter resumed. One senior dealer told me, half joking but half serious, that everyone had been waiting for this number even though no one wanted it to come so soon.

Traders Admit Pressure Is Real

While the Reserve Bank of India has been active in the market through the year, traders said the pressure this week felt heavier. Foreign investors have pulled out billions from Indian equities since January, leaving a clear dent in demand for the rupee. A private bank trader said, “The outflows have been persistent. We defend the currency for a few hours and then a new wave of selling shows up. At some point the market just gives in.”

He added that some investors are worried about slow foreign direct investment and the uncertainty around global trade. When big money hesitates, the currency usually reflects that fear.

Oil Prices Add More Weight

One major reason behind the rupee’s weakness is India’s dependence on imported crude oil. Any jump in global oil prices hits India directly. Importers need dollars to pay for shipments and that dollar demand often pushes the rupee lower. This month, crude prices have remained firm. For a country that imports more than eighty percent of its oil needs, even a small increase can snowball into a larger currency impact.

A senior economist at a Delhi based think tank explained it quite simply. “If oil stays high, the rupee struggles. That is the rule. And right now the global situation is tense which means oil is unlikely to soften quickly.”

Inflation Concerns Resurface

A weaker rupee also raises questions about inflation. Every time the currency drops, imported goods become costlier. Electronic items, mobile phones, laptops, industrial machinery, chemicals, and even edible oil feel the heat. Consumers may not notice the impact immediately, but the pressure builds quietly across industries.

Retailers say that price revisions usually come in the next cycle, not instantly. A Mumbai electronics store owner who sources products from China and Vietnam told me, “When the rupee falls fast, we know that landed costs will rise. We try to absorb small increases, but if the trend continues we end up adjusting prices.”

This is exactly what the government does not want at the end of the year. Inflation has been stubborn and any currency driven impact adds to the challenge.

IT Sector Finds a Silver Lining

There is one group that quietly benefits from a weaker rupee. Indian IT companies. Since most of their revenue comes in dollars, the conversion automatically boosts their rupee income. Some analysts say this is one reason why IT stocks have seen small gains even as the currency has struggled.

A Bengaluru based analyst said, “Every one rupee fall improves margins for export heavy companies. So while the broader economy faces headwinds, the export sector gets a cushion.”

What Happens Next

Currency experts expect the rupee to remain volatile through December. Much of the movement will depend on foreign flows, oil prices, and global cues. If the United States Federal Reserve tightens policies again or hints at higher interest rates, emerging market currencies like the rupee could feel more heat.

However, some traders believe the rupee might stabilise once the initial shock wears off. An FX strategist at a global bank told me, “Breaking ninety was dramatic, but markets usually settle after absorbing a big move. The key now is whether outflows slow down.”

Impact on Ordinary People

For the average Indian household, the biggest visible change will be in imported goods and fuel prices. Travel abroad becomes costlier too. Even paying for international online services gets more expensive. Students studying overseas also feel the pinch since fees and living costs climb as the rupee drops.

At the same time, Indians earning in dollars, including freelancers and families receiving remittances, get more rupees for each dollar. It is a small relief in an otherwise challenging situation.

Final Word

The fall of the rupee past ninety is not just a market headline. It is a reminder of how deeply India is tied to global currents. The next few weeks will reveal whether this is a temporary slide or the start of a longer trend. For now, both the government and the central bank will be under pressure to calm markets and reassure investors. The journey ahead looks unpredictable, and the only certainty is that every tiny movement of the dollar will be watched closely.