The Indian rupee has been volatile against the US dollar and other major currencies, with both gains and losses. The rupee has been losing value over the past few weeks due to various global and local factors. These include the state of the global economy, financial stress and concerns over rising oil prices. This is making imports of essential goods, especially oil, food and electrical goods, more expensive.
On the other hand, a weaker rupee could be beneficial for Indian exporters as their goods are cheaper in the global market, which could boost exports. However, the overall impact of currency depreciation is mixed as it could lead to higher inflation, which could affect everyday consumers. The rise in prices of imported goods puts pressure on household budgets and businesses that are dependent on foreign goods or services.
Experts said that the Reserve Bank of India (RBI) could take steps to enhance the positive impact, such as intervention in foreign trade. However, the rupee’s performance will continue to be affected by global events such as geopolitical tensions and global interest rates. This constant change highlights the need for businesses and individuals to be aware of the benefits and manage their finances accordingly.
