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The weakening of the rupee is being attributed to uncertainty over a potential trade deal between New Delhi and Washington.

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The Indian rupee slid to a record low of 90.64 per US dollar on Monday, pressured by uncertainty over a potential trade deal between New Delhi and Washington, according to market data cited by Reuters.

The currency had hit a previous all-time low of 90.55 on Friday. It has weakened about 5.5% so far in 2025, making it the worst-performing Asian currency this year.

Foreign portfolio investors have withdrawn around $18 billion from Indian equities in 2025, adding to pressure on the rupee.

Traders said concerns over U.S. trade policy remain a key factor. In the absence of a trade agreement, Indian exports to the United States face a combined tariff rate of 50%, including a 25% “reciprocal” duty imposed on Aug. 7 and an additional 25% punitive levy announced on Aug. 27.

The punitive tariffs were introduced as part of U.S. President Donald Trump’s campaign to discourage countries from buying discounted Russian oil amid Moscow’s war in Ukraine. However, trade negotiations between India and the United States have shown renewed momentum in recent months.

The rupee’s fall has drawn political criticism at home. Congress president Mallikarjun Kharge said earlier this month that the currency’s weakness reflected the Narendra Modi government’s policies. “If the government’s policy were good, the value of the rupee would increase,” he told reporters outside Parliament on Dec. 4.

His remarks followed comments by Chief Economic Adviser V. Anantha Nageswaran, who said he was “not losing sleep” over the rupee’s depreciation, arguing that it had not significantly affected inflation or exports.