In a week dominated by currency-market jitters, the Indian rupee’s slide towards the 90 mark has sparked intense speculation across trading desks. While the Reserve Bank of India stepped in briefly earlier this week—preventing the currency from breaching that psychological barrier—market participants are now debating what comes next.

Speaking to ET Now, currency expert Abhishek Goenka offered a measured but candid view of the rupee’s recent weakness and the road ahead.

In response to a question on the currency’s sharp slide and limited RBI intervention, Goenka noted that the rupee is currently seeking its natural equilibrium. “It finds its true level and unfortunately at this point of time neither the current account nor the capital account is in our favour and right now we are seeing that run of rupee like we see every two-three years, but I do not think this is something which something needs to about,” he said.

He explained that while the rupee typically sees around 3% depreciation in a cycle, this year it has already fallen close to 6%, leaving it “clearly undervalued by around 3%.” In the near term, Goenka believes the currency could slip further. “So, in short term the markets could go maybe 90.5, 91 it is anybody’s guess,” he said.

However, he emphasised that the medium-term picture remains far more stable. With inflation under control, growth holding steady, and expectations that gold imports will cool off, he believes the current account position should improve. He also anticipates positive developments on the trade front. Once these factors align, Goenka expects the rupee to firm up: “rupee is going to find its true level, I think that is close to around 88 to a dollar and these are good levels to actually start booking long-term positions of exports, especially for exporters who are active in the market.”

When asked whether a further slide was still on the cards, Goenka acknowledged the uncertainty surrounding short-term moves. “Well, it is anybody’s guess, but technically obviously the levels of 90.75 are the first levels that possibly rupee could go,” he said.

But he also pointed out that markets may soon get relief from policy actions or announcements. “As I said, we are entering into a zone where we could see some announcements coming from either India or US, something to stop this free fall and our fundamentals are saying is pretty okay. I do not think we should be reading too much in the news right now and I think we should start thinking on at these levels.”

As traders brace for volatility, Goenka’s message is clear: the worst may not be over in the very short term, but the structural story remains intact—and the rupee may well be undervalued rather than broken.

NEW DELHI: Hours before Russian President Vladimir Putin’s arrival in New Delhi, Lok Sabha leader of opposition Rahul Gandhi on Thursday criticised the Modi-led Centre, saying it no longer follows the tradition of allowing foreign dignitaries to meet the Leader of Opposition, a practice observed during the tenures of former prime ministers Atal Bihari Vajpayee and Manmohan Singh.Speaking to reporters in the Parliament complex, Rahul expressed displeasure that the LoP is not given the opportunity to meet visiting foreign leaders, arguing that the opposition also represents India.

Rahul said, “Generally, the tradition has been that whoever visits India, the LoP used to have a meeting. It used to happen in the Vajpayee government, the Manmohan Singh government. But this is not the case now. Whenever I visit abroad, they suggest that those people shouldn’t meet the LoP. People told us we have been informed not to meet the LoP. LoP provides a second perspective; we also represent India, but the government doesn’t want us to meet foreign dignitaries. PM Modi and the foreign ministry do not follow this now because of insecurity.”Congress MP from Wayanad Priyanka Gandhi also reacted on Rahul’s concern of government not letting LoP meet visiting dignitaries, she said, “It is very weird. There is a protocol, and all visiting dignitaries meet the LoP. The protocol is being reversed by the government and all their policies are based on this. They don’t want anyone to raise their voice. They don’t want to listen to any other opinion. They should abide by the protocols of a democracy. God knows what they are scared of... In a democracy, everyone should be able to put forward their opinions, discussions must be held, and appropriate action must be taken… The government is insecure, and this decision is a reflection of that… What will they get by breaking and reversing this protocol? This is their insecurity… The image of democracy is tarnished in the world.”Meanwhile, Russian media agency TASS reported that President Putin has departed for his two-day state visit to India.According to the outlet, the Russian delegation will hold wide-ranging discussions on cooperation in trade and economic areas, scientific and technological fields, and cultural and humanitarian sectors. Current international and regional issues will also be part of the agenda.TASS also reported that ten intergovernmental documents and more than fifteen agreements and memorandums between commercial and non-commercial entities of both countries are expected to be signed during the visit.Putin is scheduled to arrive in New Delhi this evening for the 23rd India–Russia Annual Summit. This is his first visit to India since the Ukraine conflict began in 2022; his last visit was in December 2021. The two-day trip is taking place at the invitation of Prime Minister Narendra Modi.The Prime Minister is also set to host a private dinner for the Russian President upon his arrival in the capital.

Consumers may soon have to brace for higher prices! The depreciation of the rupee beyond Rs 90 against the US dollar could force various sectors including consumer electronics, beauty products, and automobile manufacturers to increase their prices. This increase may end up eating into the benefits after the recent GST rate cuts. This potential price rise might neutralise the positive sales momentum these sectors saw after recent tax reductions.Companies dependent on imported components or complete imported products are seeing concerns. Several companies had postponed their price increase plans, despite escalating raw material costs, due to potential government oversight following the GST reductions effective September 22.

Rupee hits new low: Will prices rise?

Manufacturers of smartphones, laptops, televisions and major appliances have indicated plans to hike prices by around 3-7% starting December-January, according to an ET report.The price hikes aim to compensate for increased costs of memory chips, copper and additional components resulting from rupee depreciation. The imported materials constitute between 30-70% of manufacturing expenses across these product categories.“The advantages of reduced GST rates will be nullified by currency devaluation and increasing component costs,” said Avneet Singh Marwah, chief executive at Super Plastronics, which manufactures Kodak, Thomson and Blaupunkt TVs.

“Memory chip prices have increased more than six times in the past four months. We anticipate demand might decline again after the brief recovery from the GST reduction,” said Marwah according to the ET report.Also Read | Rs 90 to a dollar: What’s driving the fall and why it matters to you – explainedIndustry leaders noted they had calculated costs expecting the rupee to remain at 85-86 against the dollar, but its sharp fall to Rs 90 necessitates new calculations. Several firms had postponed regular price adjustments since October despite rising material costs, wary of being accused of profiteering after GST implementation.Presently, firms have begun notifying retailers about forthcoming price increases. Havells has indicated a 3% increase in LED TV prices, whilst Super Plastronics plans 7-10% higher prices, and Godrej Appliances will raise prices by 5-7% for air-conditioners and refrigerators from January.They indicated that a single-level change in energy efficiency ratings from January will create additional challenges. “The stricter energy rating requirements and weakening rupee necessitate price adjustments from January. Should the rupee weaken further, additional increases may be needed in the March quarter,” said Kamal Nandi, business head at Godrej Appliances. “The GST reduction benefits will be completely negated, but we have no alternative.“Consumer goods manufacturers have privately informed government officials that they cannot continue to absorb rising costs.The rapidly expanding beauty market in India, with international brands like Shiseido, MAC, Bobbi Brown, Clinique and The Body Shop, faces potential challenges due to rising import costs. Furthermore, the GST on cosmetics remains at 18%, with no provisions to offset currency-related cost increases.Also Read | ‘Not losing sleep’: CEA Nageswaran on rupee touching 90 mark versus US dollar; ‘falling rupee is not affecting…’“A weaker rupee does increase our landed cost since a significant share of beauty products across fragrances, cosmetics and skincare are imported and dollar-denominated,” said Biju Kassim, chief executive at Shoppers Stop Beauty. “For distributors like Global SS Beauty, this creates margin pressure that becomes hard to sustain long-term unless partially offset. We work closely with our global brand partners to optimise costs and hedge currency exposure, but some price correction on high-end imported portfolios may eventually be unavoidable.“The declining value of the rupee poses risks to the recent positive trend in vehicle sales, following price reductions implemented by companies on two-wheelers and cars after GST reduction benefits.Mercedes-Benz India’s managing director Santosh Iyer stated, “We estimate the positive effect of the price drop on demand for luxury vehicles to gradually wean away in the mid- to long-term, as prices of luxury cars will rise from current levels owing to deteriorating forex movement. We are mulling a price correction from January 26.”The competitor Audi India is currently evaluating its position in the market.Audi India’s head Balbir Singh Dhillon commented, “The rupee depreciation impacts the company directly and fully, but as of now, the company has not decided on the price increase or its quantum.”The government’s decision to reduce GST on compact automobiles and two-wheelers from 28-31% to 18% resulted in actual price reductions of 8.5-9.9%. This led to increased sales of 17% and 19% in October and November respectively, following a sluggish first half of the financial year. However, the current currency fluctuations might neutralise this surge in demand.