Indian Rupee Hits Record Low Against Chinese Yuan Amid Market Uncertainty
The Indian rupee weakened to 90.20 per dollar and approached a record low of 12.95 against the Chinese yuan on January 12, 2026. This depreciation is attributed to weak domestic equities, foreign investor outflows, and uncertainty surrounding a US-India trade deal now expected in the second half of 2026.
Insights:
The Indian rupee has continued its downward trajectory, weakening to 90.20 per US Dollar and nearing a record low of 12.95 against the Chinese Yuan as of January 12, 2026. This depreciation reflects a confluence of factors, including lackluster domestic equity performance, foreign portfolio outflows, and persistent uncertainties regarding a US-India trade deal, now postponed to the second half of 2026. Market analysts, including those from MUFG, forecast that the rupee could further weaken to 92.00 per dollar by the third quarter of 2026.
The Indian equity markets, represented by the BSE Sensex and the Nifty 50 , both registered a 0.5% decline on the day, exacerbating the pressure on the rupee. In contrast, the Chinese Yuan has been gaining strength, with the US Dollar to Chinese Yuan exchange rate nearing a three-year high. Investor sentiment towards the yuan remains robust, as evidenced by long bets reaching a 15-year peak.
