The Indian Rupee faced a dual assault from geopolitical uncertainty and a brutal selloff in domestic equities on Tuesday, February 24, 2026. While the local unit started the week on a positive note, the momentum shifted as the US Dollar Index (DXY) gained strength and the BSE Sensex witnessed its sharpest single-day erosion in weeks, losing nearly ₹3 lakh crore in investor wealth.
Add businessleague.in as a Preferred Source
Forex traders noted that while the Rupee hit an intraday low of 90.97, it was shielded from a deeper plunge by suspected dollar selling by the Reserve Bank of India (RBI).
Also Read |Tamil Nadu Voter List Purge: 97 Lakh Names Deleted in SIR Phase 1
The 91 Barrier: RBI’s Silent Intervention
Market analysts, including those from Finrex Treasury Advisors, observed that the central bank remains resolute in defending the 91 level.
-
The Strategy: The RBI likely sold dollars to absorb the excess demand from importers and foreign portfolio investors (FPIs) who were exiting the IT sector.
-
Range Forecast: The Rupee is expected to oscillate in a tight band of 90.75 to 91.20 as the market prepares for the US President’s upcoming State of the Union address.
The IT Rout: AI Disruption and Claude Code
The primary drag on the Rupee was the carnage on Dalal Street. The Nifty IT Index crashed by 4.74%, triggered by news from Anthropic.
-
The Catalyst: Anthropic’s new “Claude Code” tool showcased the ability to automate the modernization of legacy COBOL systems—the backbone of global banking.
-
The Fallout: This fueled fears that Indian IT giants (TCS, Infosys, HCLTech) could face massive disruption in their high-margin maintenance contracts. In fact, IBM fell 13% overnight in the US, setting the tone for the Indian market’s 1,000-point slide.
Also Read |Tamil Nadu Voter List Purge: 97 Lakh Names Deleted in SIR Phase 1
The “Trump Factor”: Tariff Spikes and Trade Uncertainty
Compounding the currency’s woes is the renewed trade friction between New Delhi and Washington.
-
The Defiance: Following the US Supreme Court’s ruling that struck down “reciprocal tariffs,” President Trump signaled defiance by threatening a 15% global tariff under Section 122 of the 1974 Trade Act.
-
Trade Deal in Limbo: An Indian delegation has reportedly postponed its visit to Washington, as the legal landscape of the “India-US Interim Trade Deal” undergoes a fresh review.
Reality Check
The Rupee at 90.95 feels weak. Still, it is holding up remarkably well given that Brent Crude is testing seven-month highs above $72/barrel. Therefore, while the currency is “declining,” it is actually exhibiting “resilient weakness.” In fact, without the RBI’s intervention, the 91-mark would likely have been breached today. The FII inflows of over ₹3,400 crore on Monday act as a temporary cushion, but they are increasingly being outweighed by “Imported Inflation” risks.
The Loopholes
President Trump announced a “15% global tariff.” In fact, experts suggest the effective rate for India could be closer to 17.5% when combined with existing MFN (Most Favored Nation) rates. Therefore, the “18% Deal Rate” negotiated in early February is now under heavy scrutiny. Still, the “Intervention Loophole”—where the RBI sells dollars into the market—only works as long as India’s Forex Reserves remain near their record $700+ billion highs. A prolonged trade war could test even this massive war chest.
Also Read |Tamil Nadu Voter List Purge: 97 Lakh Names Deleted in SIR Phase 1
What This Means for You
If you are planning an overseas trip or a foreign university payment, do not wait for 90.50. First, recognize that the RBI is defending the floor, not pushing for a recovery. Then, if you are an investor in IT stocks, realize that the “AI Disruption” narrative is currently driving sentiment more than actual earnings; volatility will be the new normal.
Finally, understand that oil marketing companies (OMCs) like HPCL and BPCL will remain under pressure as long as Brent stays above $70. You should check for petrol and diesel price revisions in early March if the Rupee stays at these levels. Before making large forex transactions, watch the US-Iran nuclear talks scheduled for Thursday, as any escalation there will send the Rupee straight toward 91.50.
What’s Next
The US President’s State of the Union address on February 24 (US time) will be the next major trigger. Then, the market will focus on India’s Q4 GDP data releasing this Friday. Finally, look for the Geneva talks between the US and Iran to either cool down crude prices or ignite a fresh rally in the dollar.
Also Read |Tamil Nadu Voter List Purge: 97 Lakh Names Deleted in SIR Phase 1
End….
Add businessleague.in as a Preferred Source
