Rupee Breaches 91 Mark, Hits Record Low Amid Global Tensions
The currency opened at 91.05 and quickly depreciated, reaching as low as 91.58 during intraday trading.
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The Indian rupee fell to a record low, breaching the 91 mark against the US dollar in early trade on Wednesday, 21 January 2026. The currency opened at 91.05 and quickly depreciated, reaching as low as 91.58 during intraday trading. This decline was driven by persistent foreign fund outflows, heightened geopolitical tensions, and a cautious global investment environment. The Reserve Bank of India’s intervention was not immediately evident during the session, and the rupee’s weakness continued to weigh on investor sentiment.
According to Deccan Herald, the rupee’s fall of 61 paise to 91.58 against the dollar marked its lowest level ever, with forex traders citing ongoing tensions over the Greenland dispute and potential US tariffs as key factors. The rupee had previously closed at 90.97 on 20 January 2026, and its earlier record intraday low was 91.14 on 16 December 2025.
As reported by Hindustan Times, risk aversion linked to US President Donald Trump’s statements on Greenland compounded pressures on the rupee. Foreign investors have withdrawn $2.7 billion from Indian equities in January 2026, following $19 billion in outflows the previous year. Delays in finalising an India-US trade deal have also contributed to negative sentiment.
Market analysis indicated that the rupee’s depreciation was further exacerbated by steady dollar demand and a sluggish domestic stock market. Rising geopolitical uncertainty and renewed US expansionary signals have increased risk aversion, keeping emerging market currencies under pressure. The Sensex dropped 385.82 points to 81,794.65 in opening trade, while the Nifty declined 91.5 points to 25,141.
Foreign institutional investors offloaded equities worth Rs 2,938.33 crore on 20 January 2026 as coverage revealed, contributing to the rupee’s decline. Global equity markets also experienced sharp losses, with the US S&P 500 and Nasdaq indices posting their worst single-day falls since October. Renewed US tariff threats and persistent foreign investor selling have weighed heavily on market sentiment.
The rupee is getting hit by global uncertainties due to geopolitical developments, in addition to idiosyncratic issues like the US trade deal and capital outflows.
In the broader context, recent reporting indicated that the rupee has fallen over 1% in January 2026 and 6.5% in the current financial year, making it Asia’s worst-performing currency. Persistent foreign outflows and global uncertainties, including US pressure on Greenland, have led to a risk-off sentiment in markets, with traders expecting further volatility and the rupee potentially moving towards 92 if tensions escalate.
On 20 January 2026, the rupee breached the 91 mark for the first time in the year, settling at 90.98 after touching a low of 91.06 during the session as analysis showed. The Reserve Bank of India intervened with dollar sales to support the currency, but the rupee’s depreciation bias remains strong due to ongoing global and domestic pressures.
“Rupee has a strong depreciation bias due to recent events. The dollar liquidity support from the RBI can only keep it stable and I expect the central bank to provide that at 91 levels, considering the depreciation that we already have. However, the currency will move towards 92 if geopolitical tensions further escalates,” said Alok Singh, treasury head, CSB Bank.
In addition to currency pressures, gold prices in India surged to record highs, with gold futures reaching Rs 1,58,339 per 10 grams, reflecting increased demand for safe-haven assets at the end of the session. The depreciation of the rupee has made gold imports costlier, further pushing up local prices and reinforcing the impact of global risk aversion on Indian markets.
Note: This article is produced using AI-assisted tools and is based on publicly available information. It has been reviewed by The Quint's editorial team before publishing.