₹ hits new low on US visa shock

Exporters don’t expect much relief; currency may slip to 89.5 vs $ by year-end

- ANJALI KUMARI & SHREYA NANDI

The rupee slid to a fresh low of 88.75 against the dollar on Tuesday, dragged down by the sharp rise in H-1B visa fees that threatens India's information technology (IT) services margins and remittance inflows. Dealers said the move compounded fragile sentiment, even as the trade outlook remained under sustained pressure from higher US tariffs on Indian goods.

The currency had closed at 88.31 per dollar the previous day.

Foreign investors offloaded equities worth ₹3,551 crore on Tuesday. Over the past two days, their net selloff amounts to nearly ₹5,523 crore.

Exports have already been squeezed by a 50 per cent tariff on shipments to the US, leaving Indian goods overpriced by as much as 30-35 per cent, while Europe’s slowdown has narrowed diversification options. According to exporters, although a weaker rupee would usually aid competitiveness, tariff barriers blunt much of the advantage.

"Even if we are gaining a 2-3 per cent (edge) vis-à-vis our competitors, this will not help much," said Ajay Sahai, director-general and chief executive of the Federation of Indian Export Organisations.