How the rupee changes what your Indian fund earns at home
A fund can gain in rupees and still lag in dollars when the rupee weakens. Here are ten years of official rates, two invented examples and the rate rules for the U.S., Canada and the UK.
Prepared by Prem Tax and Accounting Corp. Last checked against official sources on November 5, 2026.
Your return at home has two parts: what the fund earned in rupees, and what the rupee did against your own currency. The Home-Currency Lens Card turns every rupee figure into your money with one named rate source. Past moves say nothing about the future.
- Rupees per U.S. dollar rose from 66.33 on 31 December 2015 to 89.92 on 31 December 2025: 35.6% more rupees per dollar (FBIL/RBI reference rate).
- At year ends the rupee weakened against the dollar in nine of the ten calendar years 2016 to 2025 and strengthened only in 2017.
- Use one rate source per calculation. On 31 December 2025 the FBIL/RBI rate was 89.9198, the Federal Reserve 89.84 and Treasury 89.854.
Source: RBI Reference Rate Archive; 2018 to 2021 from the RBI Handbook of Statistics
Invented example, U.S. holder
| Item | Rupees | U.S. dollars |
|---|---|---|
| Cost, 31 December 2015 (Rs 66.3260 per dollar) | Rs 10,00,000 | $15,077.04 |
| Value, 31 December 2025 (Rs 89.9198 per dollar) | Rs 18,00,000 | $20,017.84 |
| Gain | 80.00% (Rs 8,00,000) | 32.77% ($4,940.80) |
| Value at the old rate | Rs 18,00,000 | $27,138.68 |
The rupee's move cost $7,120.84. In a second invented case, a Toronto holder paid Rs 10,00,000 on 31 December 2024 (0.01681 Canadian dollars per rupee, CAD 16,810). A year later, at 0.01525, Rs 11,20,000 is CAD 17,080: a 12.00% rupee gain, a 1.61% Canadian gain.
Which rate does a return use?
| Country | Rule in short |
|---|---|
| USA | The IRS has no official rate: each item uses the rate on its own date, from any posted source used consistently. For FBAR and Form 8938 the year's last day is converted at the Treasury rate |
| Canada | An amount is converted at the Bank of Canada rate on the day it arose; in some cases an annual average is allowed |
| UK | Income is converted at the rate on the date it arose (HMRC points to its published rates). For gains, cost and proceeds are each taken at their own dates, using a method that is reasonable and consistent |
Our checklist
The Home-Currency Lens Card, per holding:
- Date and rupee amount of each purchase and sale, with the rate and its source.
- Year-end value in rupees and in your currency, from the source your return uses.
- Each January, add the Bank of Canada annual average and the 31 December rates.
Mistakes people make
- Mixing rate sources in one calculation.
- Converting an old purchase at today's rate.
- Reading a rupee gain as a dollar gain.
FBIL, not the RBI, has set the reference rate since 10 July 2018; the RBI republishes it. Rates change daily. Our year-end checklist lists rates to save, and our IRS rates tool shows yearly averages.
Common questions
Which rate do I use on a U.S. return?
That depends on the line. For FBAR and Form 8938, take the Treasury year-end rate. Income and gains take the rate on each item's date.
Where do I find old rates?
Daily rates are missing from the RBI's online archive between 25 July 2018 and 11 April 2022. For those years use the RBI Handbook of Statistics.
Will the rupee keep falling?
Nobody can say, and we do not predict it. The chart shows history only.
Official sources
- RBI: Reference Rate Archive
- IRS: Yearly average currency exchange rates
- U.S. Treasury: Reporting rates of exchange
- Bank of Canada: Annual average exchange rates
- Federal Reserve: H.10 historical rates, India
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