The rise of the dollar and global economic pressures in 2025 have put the Indian rupee under severe pressure. The rupee has fallen by about 4.3% this year, making it the weakest currency in Asia. US tariffs, trade deal uncertainty, higher US interest rates and heavy selling by foreign investors increased demand for the dollar and weakened the rupee further. India’s heavy import dependence, especially on crude oil, electronics and fertilisers, has been increasing the current account deficit. RBI intervened from time to time in the market, but only to control volatility, not to save the fixed rate. Imported inflation is increasing, dollar loans of companies are becoming expensive and prices of energy and industrial goods are going up. This video explains in detail what are the reasons behind the weakness of the rupee, what is its impact on the Indian economy and consumers, and what are the future prospects. It also explains whether this is a prolonged structural slide or the effect of trade shocks of 2025.

The rise of the dollar and global economic pressures in 2025 have put the Indian rupee under severe pressure. The rupee has fallen by about 4.3% this year, making it the weakest currency in Asia. US tariffs, trade deal uncertainty, higher US interest rates and heavy selling by foreign investors increased demand for the dollar and weakened the rupee further. India’s heavy import dependence, especially on crude oil, electronics and fertilisers, has been increasing the current account deficit. RBI intervened from time to time in the market, but only to control volatility, not to save the fixed rate. Imported inflation is increasing, dollar loans of companies are becoming expensive and prices of energy and industrial goods are going up. This video explains in detail what are the reasons behind the weakness of the rupee, what is its impact on the Indian economy and consumers, and what are the future prospects. It also explains whether this is a prolonged structural slide or the effect of trade shocks of 2025.

Rupee vs dollar: On Monday, the Indian rupee showed strength against the dollar on the first business day of the week. As soon as the market opened, the rupee gained 20 paise to 87.46 and later reached 87.39 per dollar. This strength comes at a time when there was a tremendous rise in the domestic stock market and Prime Minister Narendra Modi announced GST reforms in a historic address from the Red Fort on Independence Day.

Rupee strength

Foreign currency traders say that although there is uncertainty about trade tariffs between Indo-US, but currently the boom of the domestic market has supported the rupee. In the last trading session (Thursday) the rupee closed at 87.59. The currency and stock market remained closed due to Independence Day holiday on Friday 15 August.

Meanwhile, the dollar index, which showed the dollar status against six major currencies, rose 0.01 percent to 97.86. International standard Brent crude fell 0.06 percent to $ 65.81 per barrel.

Why is Indian currency strong?

Domestic stock markets also saw a boom. The BSE Sensex rose by 1,021.93 points to 81,619.59, while the Nifty rose by 322.2 points to trade at 24,953.50. However, according to the stock market data, foreign institutional investors (FIIs) were selling on Thursday and sold shares worth Rs 1,926.76 crore.

Also read: Gold shine faded by Trump-Putin meeting, know the fresh sense of your city on August 18, 2025 today