Indian rupee sinks to all-time low; Omani rial crosses 233 mark

Muscat: The Indian rupee plunged to a new record low on Tuesday, breaching 233 against the Omani rial for the first time, marking a significant moment in currency markets and offering a boost to remittances for Oman’s Indian expatriate community.

Exchange houses across the Sultanate were quoting around Rs 233 per rial, while Bank Muscat’s mid-day rate stood at Rs 232.93 at 12.30 pm. The exceptional rate triggered heavy remittance activity as many Indians seized the opportunity to send money home at historically favourable levels.

The rupee’s weakness has been driven by persistent outflow pressures, a widening trade deficit, and the absence of a long-anticipated US–India trade agreement. Despite strong macroeconomic indicators in India—such as solid GDP growth in the September quarter and relatively low inflation—the currency continued its downward slide.

Against the US dollar, the rupee slipped to 89.7975, surpassing Monday’s previous record of 89.7575. It briefly touched 89.85 before the Reserve Bank of India intervened to prevent a decisive break past the psychologically significant 90 level. The RBI has been active in the foreign-exchange market in recent weeks, initially defending the 88.80 mark before allowing further depreciation once that threshold was breached.

Economists note that India’s widening trade deficit is expected to expand the current account shortfall this fiscal year. HSBC projects the deficit will rise to 1.4 per cent of GDP, up from 0.6 per cent last year. With foreign investors pulling nearly USD 17 billion from Indian equities so far this year, currency pressures have intensified.

Importers have also accelerated their hedging activities amid expectations of further rupee weakness, adding more strain to the currency. Exporters, meanwhile, have been slower to hedge, delaying conversions in hopes of even better rates.

Financial analysts, including MUFG Bank, warn that underlying conditions point to continued rupee softness in the months ahead and that the RBI may eventually allow the currency to drift past the 90-per-dollar mark.

For now, however, the immediate impact is being felt in Oman, where the unprecedented rial-to-rupee exchange rate is reshaping remittance behaviour and offering Indian expatriates some of the strongest conversion values ever recorded.