<h1>Rupee falls to record low amid capital outflows and geopolitical risk; RBI reserves provide stabilising buffer but vulnerability remains</h1> Rupee depreciation driven by sustained foreign portfolio outflows and heightened geopolitical risk weakened the currency to a record low, increasing external sector vulnerability; this exposure is likely to persist until geopolitical tensions abate and a pending trade agreement materialises, which could restore confidence. The Reserve Bank of India retains capacity to intervene given strong foreign exchange reserves, providing a stabilising buffer and aiding export competitiveness via a cheaper real effective exchange rate. Persistent capital flow volatility and declining domestic equities reflect systemic risk to market stability and import cost pressures, with implications for macroeconomic management and trade balances.