On September 24, the Indian rupee hit a fresh record low, opening between ₹88.85 and ₹88.90 against the US dollar, marking the steepest single-day fall in a month. Experts point to several factors driving this decline, with the recent hike in US H-1B visa fees being a key contributor. Indian IT companies, which deploy thousands of professionals to the US annually, now face higher costs per employee, potentially slowing IT exports. Analysts predict IT export growth could slip below 4% in the coming fiscal year, down from earlier estimates of 5%.
The visa fee increase also impacts individual professionals, possibly discouraging overseas assignments and reducing remittances. Economists estimate a potential $400 million drop in money sent home by Indians abroad—a significant concern for a country dependent on foreign inflows.
Other pressures on the rupee include US tariffs on Indian goods, weakening of neighboring Asian currencies, and global uncertainties surrounding US Federal Reserve interest rate decisions. This combination is increasing stress on the currency.
The rupee’s decline has also influenced bullion markets. Rising gold prices are fueled both by the weakening rupee and China’s push to expand its gold reserves through the Shanghai Gold Exchange.
Despite the volatility, markets remain relatively stable. Companies are employing hedging strategies, and the Reserve Bank of India is managing the currency carefully, widening the trading band while maintaining orderly conditions to prevent disorderly fluctuations.
