Tracking the Fall of the Rupee – and What It Means
From ₹43 to over ₹85 per dollar – in the last 25 years, the Indian Rupee has seen a steady slide against the US Dollar. But is this devaluation always a sign of economic weakness? Or does it reflect a global shift, inflation adjustment, and India’s structural transformation?
Today we will understand:
- How the INR–USD exchange rate moved from 2000 to 2025
- Currency movement across different Indian governments
- A comparison of India’s currency performance vs. the world’s top 10 economies
- And what this means for trade, inflation, and the common Indian
India’s Exchange Rate Journey (2000–2025)
| Calendar Year (Jan–Dec) | INR per USD (Annual Average) | Government in Power |
| 2000 | 44.94 | BJP-led NDA |
| 2001 | 47.19 | BJP-led NDA |
| 2002 | 47.19 | BJP-led NDA |
| 2003 | 46.58 | BJP-led NDA |
| 2004 | 45.32 | Congress-led UPA |
| 2005 | 44.10 | Congress-led UPA |
| 2006 | 44.10 | Congress-led UPA |
| 2007 | 41.35 | Congress-led UPA |
| 2008 | 43.50 | Congress-led UPA |
| 2009 | 48.40 | Congress-led UPA |
| 2010 | 45.73 | Congress-led UPA |
| 2011 | 46.67 | Congress-led UPA |
| 2012 | 53.44 | Congress-led UPA |
| 2013 | 58.60 | Congress-led UPA |
| 2014 | 61.03 | BJP-led NDA |
| 2015 | 64.15 | BJP-led NDA |
| 2016 | 67.20 | BJP-led NDA |
| 2017 | 65.12 | BJP-led NDA |
| 2018 | 68.39 | BJP-led NDA |
| 2019 | 70.42 | BJP-led NDA |
| 2020 | 74.10 | BJP-led NDA |
| 2021 | 73.92 | BJP-led NDA |
| 2022 | 78.60 | BJP-led NDA |
| 2023 | 82.60 | BJP-led NDA |
| 2024 | 83.66 | BJP-led NDA |
| 2025 | ≈85.75 | BJP-led NDA |
Calendar Year (Jan–Dec). Source: 2000–2023 data from Reserve Bank of India (RBI); 2024 average based on FRED (Federal Reserve Economic Data); 2025 value is year-to-date average till 11 July 2025 from FRED.
The chart below visualizes the INR per USD annual average from 2000 to 2025, highlighting currency trends under different governments.
Key Insight: The rupee has depreciated by ~91% against the dollar from 2000 to 2025. But this is not unusual – most emerging economies show similar trends over the long term.
How India’s Rupee Performed vs Other Major Currencies (2000–2025)
| Country | Currency | 2000 Value vs USD | 2025 Value vs USD | % Change | Appreciation / Depreciation |
| India | Rupee (INR) | 44.94 | 85.8 | -91% | Depreciation |
| China | Yuan (CNY) | 8.27 | 7.16 | 13% | Appreciation |
| Japan | Yen (JPY) | 107.8 | 147.29 | -37% | Depreciation |
| UK | Pound (GBP) | 1.51 | 1.35 | -11% | Depreciation |
| Eurozone | Euro (EUR) | 0.92 | 1.17 | 27% | Appreciation |
| Brazil | Real (BRL) | 1.83 | 5.57 | -205% | Depreciation |
Note: Percentage change is approximate and reflects nominal values.
Observation:
- While the Indian Rupee has weakened against the US Dollar since 2000, it has remained more stable compared to many other emerging market currencies.
- Meanwhile, currencies like the Chinese Yuan and the Euro have shown relatively better performance against the Dollar over this period.
What Drives These Currency Movements?
- Inflation differential between India and the US
- Interest rate policies of central banks (RBI vs Federal Reserve)
- Trade balance and capital flows (FDI, FII)
- Crude oil imports, which heavily affect India’s forex outgo
- Political stability and investor confidence
- Global financial crises, pandemics, and war impacts
INR Depreciation: Should You Worry?
While the INR’s fall may seem worrying at first glance, it has both benefits and drawbacks for the common Indian:
- Higher prices for imports: Everyday goods like fuel, smartphones, and electronics become costlier as India pays more in rupees to import them.
- Inflation impact: A weaker rupee can contribute to inflation – raising the cost of living, especially for households dependent on imported essentials.
- Foreign travel & education get expensive: Overseas trips and international tuition fees rise with a weaker INR.
- Good for exporters & remittances: Exporters benefit as their goods become more competitive abroad. Families receiving money from NRIs get more rupees for every dollar.
- Investment & policy implications: The RBI often steps in to manage volatility – and that helps keep inflation under control and currency panic in check.
The Road Ahead: Can India Stabilize the Rupee?
With rising forex reserves, a push for self-reliance, and a digital economy boom, India has better macroeconomic buffers now. While the rupee may not appreciate drastically, stability is likely the new goal – and the RBI’s proactive approach reflects that.
Data Sources
India (INR/USD):
- 2000–2023: Reserve Bank of India – Handbook of Statistics on Indian Economy (annual average reference rates)
- 2024: U.S. Federal Reserve – G.5A Annual Exchange Rates (based on daily noon buying rates)
- July 2025: U.S. Federal Reserve – H.10 Historical Rates (e.g., ~₹85.75 per USD as of July 11, 2025)
Other Major Currencies (2000 & 2025):
- U.S. Federal Reserve – H.10 Historical Exchange Rates
Note: Exchange rates used are annual averages. 2025 values reflect data available up to 11 July 2025.
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Bonus: Curious to See Gold’s Performance in This Period?
Check our blog on India’s Gold Reserves 2000–2025 to see how gold hedged India’s macro bets.
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