The Indian rupee has hit an all-time low, surpassing 87 against the US dollar for the first time in history.
This significant drop was mainly due to the impact of recent developments in global trade, particularly the new tariffs imposed by US President Donald Trump.
On Monday, the rupee plunged to a record low of ₹87.07 against the dollar, as global currency markets reacted to growing trade tensions.
The fall came after Trump signed three executive orders over the weekend, which directly impacted global trade dynamics.
These executive orders introduced new tariffs, including a 25 pc tax on imports from Mexico and Canada, and a 10 pc tariff on goods from China, all set to take effect on Tuesday.
The implementation of these tariffs has bolstered the value of the US dollar, making it stronger in comparison to most other global currencies, including the rupee.
As the US dollar strengthened, it created pressure on other Asian currencies, including the Chinese yuan, which weakened by 0.5 pc to 7.35 per dollar.
Since the rupee and yuan often move in the same direction, this caused additional strain on the Indian currency.
The US dollar’s strength is further evident as the dollar index, which tracks the value of the US dollar against six major currencies, rose by 0.3% to 109.8.
Traders predict that the rupee may continue to weaken throughout the day, with some expecting further depreciation in the coming weeks.
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