Rupee in Freefall: Slips Past 94 vs Dollar; Indian Currency Falls to Record Low, What's Behind Crash?

Indian currency is in shambles as the Rupee plunged past the 94 per US dollar mark for the first time ever, hitting a fresh record low amid global economic turmoil and rising crude oil prices.

The rupee vs dollar today touched around 94.03 in intraday trade with a historic fall and intensifying concerns over currency depreciation, inflation risks, and capital outflows.

Why Rupee Is Falling Today?

Rising crude oil prices are the biggest trigger for sharp depreciation in the Indian rupee against the US dollar, as they increase India's import costs and dollar demand. Brent Crude jumped $109.7 per barrel, rising 1.64% at the time of writing.

As per Trading Economics, "President Donald Trump extended the deadline for a planned strike on Iranian energy infrastructure to April 6 to allow for negotiations, saying talks with Tehran were going "very well." Trump also noted that Iran had allowed 10 oil tankers to pass through the Strait of Hormuz this week as a gesture of goodwill, while Treasury Secretary Scott Bessent said an insurance program to support shipping through the waterway would begin soon. WTI prices remain up roughly 40% since the conflict began, as Tehran effectively closed the narrow waterway through which about a fifth of global energy flows"

Persistent foreign institutional investor (FII) outflows from Indian equities have also added to the pressure. As per market data, FII sold nearly Rs. 3.15 trillion worth of stocks, so far, in FY26 as investors shift funds to safer assets amid global uncertainty.

Goldman Sachs Cuts India Outlook, Lowers Nifty Target

Weak domestic equity markets have further dampened sentiment. Sensex & Nifty are trading lower today both the benchmarks are down more than 1% so far in today's trading while the indices have fallen about 8% in the last 30 days due to a massive crash.

Global brokerage Goldman Sachs has added to market concerns by downgrading Indian equities to "market weight" from "overweight", due to worsening macroeconomic conditions and slowing earnings growth.

The firm has also reduced its Nifty 12-month target to 25,900 from 29,300, indicating lower return expectations for investors. According to the report, earnings growth is expected to remain modest, while risks in the near term are tilted to the downside due to weak visibility and ongoing global uncertainties. However, Goldman Sachs noted that once earnings stabilise over the next few quarters, equities could see a recovery, especially if global energy disruptions ease.

Will RBI Intervene to Support Rupee?

It is high time for the Reserve Bank of India for possible intervention as the central bank has historically stepped in during periods of excessive volatility to stabilise the currency.

While intervention cannot fully reverse global trends, it can help stop the sharp fluctuations and prevent panic in the forex market.

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