The rupee came close to its record low this month. Here is what that means if you run a company across the US and India.
US–India This Week, a Friday read from the SRF Cross-Border desk: where the rupee is, why it has slid, and what to do about it.
Summary
- The rupee came within paise of its record low in early October and is about 5.6% weaker against the dollar this year.
- For a company run across the US and India, that changes India costs, transfer pricing margins and the timing of every remittance.
- Nobody can call the next move, so know your exposure and set hedging and timing by policy.
If your company has one foot in the US and one in India, the rupee's rate shows up in your own numbers. It changes how much profit each side keeps, what your India team costs in dollars, and when to move money across the border.
This is the first US–India This Week from the SRF Cross-Border desk. Each Friday we take the week's news and say what it means for a company run across both countries.
Where the rupee stands at the end of October
The rupee traded at about 95.2 to the US dollar this week. Its all-time low is 96.96, touched during trading on 20 May 2026.
Early this month it came close to that low again, closing at 96.78 on 8 October. The Reserve Bank of India (RBI) then stepped in, and the rupee recovered to about 94.3 by 21 October before drifting back.
It ended 2025 at about 89.87, so it is about 5.6% weaker this year. A dollar now buys about 5.3 more rupees than it did on 1 January.
For a business, the direction and the size of the swings matter more than any one day's rate. In October alone the rate moved by about 2.5 rupees.
Why the rupee has been under pressure
US interest rates went up, and may rise again
The Federal Reserve raised its target range by a quarter point, to 3.75 to 4.00%, on 16 September, its first increase since July 2023. On 28 October it held, by 10 votes to 2.
The two, Lisa Cook and Beth Hammack, wanted another quarter-point rise. Higher US rates draw money into dollars, which weakens the rupee, so the live question is whether the Fed raises again.
Oil has made India's import bill heavier
India pays for its oil imports in dollars. Petroleum imports from April to September 2026 were about $113.8 billion, against $92.1 billion a year earlier, on higher prices.
The goods trade deficit for those six months widened to $177.64 billion, from $156.88 billion. Gold is a smaller part of it this year: imports fell 27% to $19.27 billion after the duty rose from 6% to 15% on 13 May.
Market reports also point to foreign money leaving Indian shares and bonds, and to oil prices pushed up by the conflict in West Asia.
The RBI is leaning against the slide
On 10 October the RBI opened a special window for the three state-run oil companies: Indian Oil, Hindustan Petroleum and Bharat Petroleum. From 12 October it meets their entire daily dollar need through designated banks, until further notice.
That keeps their large, routine dollar buying off the open market. The same day the RBI curbed the rebooking of currency derivatives and cut the limit on exchange-traded rupee derivative positions. On 7 October it had raised its repo rate by 25 basis points to 5.50%.
It has been spending its reserves too. They stood at $721 billion in the week to 16 October, the fifth weekly fall, against a peak of nearly $786 billion in early September.
Trade explains less than the headlines suggest
In early February, news of a US–India framework for an interim trade deal lifted the rupee about 1.3% in a day. The deal is still not signed.
Since then, the pressure has come from US rates, the oil bill and money leaving India's markets.
What a moving rupee means for a US–India company
A weak rupee that also swings reaches most parts of a cross-border business. It shows up in five places.
You earn in dollars and spend in rupees
Your dollars now stretch further on India salaries and other local costs, which is a real tailwind. Do not budget it as permanent margin. The rupee can turn, as it did for two weeks this month.
India pays the US parent and US vendors
Fees to the parent company, US software and overseas vendors all cost more in rupees when the rupee is weak. Put the higher rupee cost in the budget now, before it surprises you at payment time.
Your transfer pricing moves with the rate
Many India subsidiaries bill their US parent on a cost-plus basis. That usually means a rupee cost base plus a markup, invoiced in dollars.
When the rate moves, the rupee value of each invoice moves with it. So do the margin each side reports and the tax each country collects.
Check that your policy still lands where you documented it, because India's tax department and the IRS both test the real numbers against the paperwork. Our guide to US–India transfer pricing covers how the markup is set, and the intercompany services agreement is where it is written down.
Timing and hedging become real decisions
While the rupee is weak and moving, decide on purpose when you convert money and whether to hedge, which means locking in a rate ahead of time. Leaving both to the rate on the day is also a choice.
For money leaving India, the tax forms come before the transfer. A payment to a non-resident may need tax withheld where it is taxable in India, and usually needs Form 145, formerly 15CA, before each remittance.
Larger taxable payments also need a chartered accountant's Form 146, formerly 15CB, under the Income-tax Act 2025 and the Income-tax Rules 2026. Plan the filing and the conversion together, so the forms do not delay a conversion you timed.
Our FEMA and RBI page sets out the rest of India's rules on money crossing the border.
Your runway leans one way or the other
If you raised in dollars and spend mostly in rupees, a weaker rupee stretches your . Each dollar funds more months in India.
If you earn in rupees and spend heavily in dollars, it does the opposite. Know which way your company leans, because that tells you whether a weak rupee helps or hurts.
What we are watching next week
- Whether the RBI keeps stepping in, and how hard. Its weekly reserves figure, published on Fridays, is the clearest sign.
- US jobs and inflation figures. They shape the Fed's next move, and the Fed moves the dollar.
- The oil price, India's biggest swing factor, because India pays for its oil in dollars.
The one rule for the corridor
Do not try to guess where the rupee goes next. Nobody does that reliably.
Know your exposure instead: which currency you earn in, which you spend in, and what crosses the border when.
Set your hedging and your timing by a clear policy, not by the latest headline.
With a policy in place, a move either way is one you planned for.
SRF Capital Studio's Cross-Border desk helps US–India tech, SaaS and investor-backed companies run as one company, from tax and transfer pricing to and RBI. For a read of your own exposure and what to fix first, start with a Corridor Health Check.
Figures as of 30 October 2026, from the RBI, the Federal Reserve, the commerce ministry and market reports. Currency levels move daily, so check a live rate before relying on one. This is general information for business owners, not investment, tax or legal advice.
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What we do about it, for founders and finance teams. Each has its own page.
Tax & Transfer Pricing
Indian and US tax for companies working in both countries: transfer pricing, the treaty, withholding, GST and US sales tax, on one set of numbers.
FEMA, RBI & Corporate
India's foreign exchange rules, RBI reporting and company law for US–India companies: foreign investment in, investment abroad, flips and annual filings.
FP&A Operations
Each month we close the books, check them against the plan, update the forecast and write the board pack, as part of your team.
