The Indian rupee may slip to an all-time low on Tuesday with the currency, already under pressure from slowing growth, choppy equity flows and a dollar rally, will have to contend with an unexpected widening in trade deficit to a record high.

Engineering exports grew 13.7% to $8.8 billion, electronics exports were up 54.7% at $3.4 billion, rice exports increased 95.1% to $1.1 billion as trade curbs were removed.

India’s trade deficit expanded to a record high in November, as the nation’s import bill ballooned, particularly due to a rise in gold shipments.

The Indian rupee weakened to its lifetime low on Tuesday, hurt by concerns about a widening trade deficit and likely outflows from local equities, although intervention by the central bank capped losses.

The local currency settled at Rs 84.90 per dollar as the Reserve Bank of India (RBI) intervened in the foreign exchange market via dollar sales

India 's trade deficit hit a record high of $37.84 billion in November, up from $27.1 billion in the previous month. The spike can largely be attributed to an 8.35% year-on-year (YoY) increase in imports between April and November, while exports only rose by a meager 2.17% during the same period, according to government data.

The U.S. trade deficit contracted sharply in October as imports declined by the most since late 2022, potentially positioning trade to contribute to economic growth in the fourth quarter.

India’s merchandise exports contracted 4.85 per cent to $32.1 billion in November while imports increased by 27 per cent to $69.95 billion, leading to a record trade deficit of $37.8 billion, commerce department data showed on Monday.

The country’s imports too increased year-on-year in November, data showed. The same was the case in September and October. The overall imports, both merchandise and services combined, increased from $68.

India's trade deficit hit a record $37.84 billion in November, driven by gold imports and declining exports, pressuring the rupee further.