Part 2/6:
In recent sessions, the Indian rupee has hit a historic low against the US dollar, trading for over 85.2 rupees per dollar for the first time. This deterioration raises alarm bells as the Reserve Bank of India (RBI) has historically intervened to stabilize the currency. Previously, the RBI maintained a psychological barrier at 84 rupees, but this support level was breached amid considerable downward pressure.
The primary factors influencing this decline include dependency on the United States as India's largest export market and potential threats of increased tariffs from the U.S. Moreover, the overarching concern is rooted in India's internal economic environment.