Indian Rupee Hits Record Low as Fitch Raises India’s GDP Growth Forecast to 6.9%

 Economy of India at a Crossroad: Rupee Keeps Fading as Growth Prospects Improve.

The last week has been a dark and light week in the Indian economy since it was full of challenges and optimism.

On the one hand, the Indian rupee has fallen to its lowest point against the U.S. dollar of ₹88.44, which is greatly contributed by the recent action of the Washington who recently imposed hefty tariffs on Indian products. The low external stability of India has also been contributed by the weak currency with the investors fearing that there is a risk that the currency may depreciate further. A lower rupee will increase the prices of imports, straining inflation and common households.

However, in the storm of this there are positive things as well. Fitch, a global ratings agency, re-examined the growth outlook of the Indian GDP to FY26 at 6.9% in light of the optimism in the strength of domestic demand and structural resilience in the country. Although global growth opportunities were revised to an improvement, Fitch raised an alarm with regards to a possible U.S. slowdown, which would spread to emerging markets.

It is on this volatility backdrop that trade diplomacy is taking center stage. India and the United States are in the process of preparing senior officials who would cool down the tensions through talks. To both economies, keeping their trade routes open is essential as India is in need to retain its export base and the U.S. aims to strike a balance between the local political needs and the foreign collaboration.

India is in a complicated economic situation, as evidenced by the conflicting signals of a weaker rupee, but a better growth forecast. India may come out of these turbulent waters intact in case trade negotiations are successful and the domestic demand remains strong. However, with tariffs becoming more difficult and rupee further depreciating, difficulties can escalate.

In the meantime, however, all are watching the next U.S.India talks, as they may help determine whether Asia’s third-largest economy will act more like an overseas bulldog or a home-grown opportunity.