Rupee may close 2026 at 93 on FDI outflows and expensive non-Russian crude

The rupee-dollar pair may depreciate to ₹93 by the end of the current calendar year as foreign direct outflows continue and India decided to purchase the relatively expensive non-Russian crude oil, according to Fitch ratings.

The rupee which had depreciated 5% crossing ₹92 a dollar in the past year may depreciate at a slower pace as clarity over the India-US trade deal emerged after the U.S. President Donald Trump posted on social media on the deal and further clarity emerged in the following days. 

“The U.S.-India trade deal has allowed the rupee to appreciate to INR90.4/USD after depreciating 5% against the dollar last year. We now expect the rupee to depreciate more slowly over 2026 and trade at around INR93/USD by the year’s end, as compared to our prior forecast of INR95/USD. Foreign direct investment outflows from profit repatriation and substitution towards expensive non-Russian crude as per the trade deal will drive this depreciation,” said Fitch in its report. 

Fitch in its Asia currency outlooks said that the U.S. rate cuts will support Asian currencies but domestic stability will play a key role the ratings agency said. “A softer U.S. dollar backdrop provides selective support, but gains will be uneven: economies with strong current accounts, credible policy frameworks and stable politics should outperform, while currencies facing fiscal slippage, trade deterioration or intervention‑heavy regimes will struggle to sustain appreciation,” Fitch said.