The Indian rupee hit a record low on Friday, breaching the 88-per-dollar mark for the first time, as markets weighed the economic fallout of fresh U.S. tariffs on Indian goods.
The currency fell to ₹88.24 per U.S. dollar, surpassing its previous lifetime low of 87.95, as sentiment soured over the escalating trade dispute. The decline comes after Washington imposed an additional 25% tariff on Indian exports earlier this week, effectively doubling the total levies faced by Indian goods to 50%.
Analysts warn that the tariff shock could erode India’s export competitiveness, denting near-term growth prospects. “A tariff-led drag on exports could add some incremental pressure to India’s trade balance,” said Hari Shyamsunder, vice president & senior institutional portfolio manager – emerging markets equity, India, at Franklin Templeton.
The fall also highlights growing investor unease over India’s external sector outlook, with concerns that a wider trade deficit may keep the rupee under pressure in the coming weeks.
