The Indian rupee is expected to remain vulnerable near the 91 level on Tuesday, with persistent flow-driven dollar demand keeping the risk of a slide to an all-time low in play.
The rupee has fallen for four sessions till Monday, losing around 1% in that period, leaving it perched near the closely watched 91 per dollar level and within striking distance of its lifetime low of 91.0750, set in the middle of last month.
The currency settled at 90.91 in the previous session, after plumbing to an intraday low of 90.99 and briefly inching past 91 on the interbank order-matching system, underscoring the intensity of the selling pressure.
The non-deliverable forward market signalled the rupee is likely to remain under pressure at Tuesday’s open, pointing to a flat-to-slightly weaker start.
Bankers said price action over the last two sessions has been particularly telling, with the rupee coming under considerable pressure on Friday and then extending its decline on Monday despite broadly supportive cues from Asian currencies.
“Price action is being dictated almost entirely by flows at the moment,” a currency trader at a bank said, adding that the sustained dollar demand is the dominant driver.
Bankers said the Reserve Bank of India has been a regular presence in the market, stepping in intermittently to lean against rupee weakness. Its support on Friday and Monday was relatively light, with traders saying the central bank was seen offering dollars at multiple levels rather than mounting a defence at any single point.
A banker said the RBI’s approach was aimed at smoothing the rupee’s decline rather than drawing a firm line in the sand.
Meanwhile, Asian currencies were mixed on Tuesday, while The dollar index retreated to its lowest level in a week. Threats from the White House towards the European Union over the future of Greenland weighed on the dollar index, while triggering a selloff in US equity futures.
Key indicators:
- Dollar index down at 99.06
- Brent crude futures up 0.1% at $64 per barrel
- Ten-year U.S. note yield at 4.25% ** As per NSDL data, foreign investors sold a net $501.2mln worth of Indian shares on January 16
- NSDL data shows foreign investors sold a net $81.5mln worth of Indian bonds on January 16
Published on January 20, 2026
