In early trade on Wednesday, the Indian rupee crossed the psychological level of 90 against the dollar and fell by 6 paise to 90.02 against the dollar. During the trading session, the rupee also appeared at the level of 90.25 against the dollar. The main reasons for this decline were the increasing demand for dollars by banks and profit booking from the stock market by foreign investors. The rupee, one of Asia’s worst performing currencies, has fallen more than 5 percent against the US dollar so far this year.
The rupee has also weakened against the dollar due to heavy US tariffs on Indian goods and the prolonged trade deal between New Delhi and Washington. Sat Duhra, portfolio manager at Singapore-based Janus Henderson Investors, told Reuters that the recent tariff dispute with the United States has actually accelerated the decline. Until this issue is resolved, the rupee will remain under pressure as India is now paying the highest US tariffs globally. Let us also tell you how the journey has been from 3 to now 90 against the dollar since 1947 i.e. the independence of the country till now…
Rupee against dollar after independence
Due to the continuous weakening of the rupee, an old myth regarding its competition with the dollar has been revived on social media. Some people are remembering the time when one rupee was equal to one dollar. However, this never actually happened. At the time of independence, the rupee was pegged to the pound sterling and not directly to the dollar. The underlying exchange rate in 1947 was approximately Rs 3.3 per dollar. Until the years after independence, the exchange rate was administratively fixed. In 1950 the rupee stood at about 4.76 rupees to the dollar, and in 1966 its value fell sharply to 7.50 rupees after a drought and balance of payments deficit.
Rupee movement after liberalization
Then, due to the pressures of the liberalization era, the rate increased from about Rs 17.5 in 1990 to Rs 22.7 in 1991, amid a severe external crisis. In the 2000s and 2010s, the currency weakened further, surpassing Rs 45 in 2000 and reaching around Rs 56.6 during the 2013 “taper tantrum”. The taper tantrum was a market panic caused by short-term fears that the Federal Reserve would stop buying bonds.
Journey of rupee and dollar relations
| Year | 1 how many rupees is the dollar worth ,About, | main thing |
| 1947 | 3.3 | After independence the rupee was linked to pound sterling, |
| 1950 | 4.76 | Introduction of fixed rate regime |
| 1966 | 7.5 | Big decline after drought and balance of payments tensions |
| 1991 | 22.74 | balance of payments crisis, beginning of reform |
| 2000 | 44.94 | Rupee fell under pressure after liberalization |
| 2013 | 56.57 | Fed taper’s anger falls on emerging markets, decline in rupee |
| 2018 | 70.09 | rise in oil prices, Rupee due to global activity 70 crossed |
| 2020 | 76.38 | Rupee falls due to pandemic shock and risk aversion |
| 2022 | 81.35 | Due to increase in global inflation and strengthening of dollar |
| 2024 | 84.83 | Continuous pressure on current account and profit booking by foreign investors |
| 2025 | 8890 | Profit booking by foreign investors, Tariff, increasing trade deficit |
Journey from 70 to 90
By 2018, the rupee had fallen beyond Rs 70. After that the era of Covid started in the year 2020. Crude oil prices fell. But who knew that in the year 2022, a war would start in Europe, which would continue for about 4 years. Due to which the prices of crude oil will reach sky high. By 2024, the average rate of rupee against dollar was around 84.8 rupees per dollar. In the year 2025, Trump once again took oath and started imposing tariffs. At present, 50 percent American tariff is imposed on India. Despite the fall in the dollar index, a huge decline has been seen in the rupee. For the last few days, the currency was hovering around Rs 88-89 per dollar, but Wednesday’s fall took it past the Rs 90 level.