The Indian rupee has hit an all time low of 77.84. Other Asian currencies like the South Korean won, Indonesian rupiah and the Philippine peso keep declining too. What is the reason for this trend of falling that we are seeing in the Asian currencies?
- The Russia-Ukraine War. Ever since the commencement of the war, the Indian rupee has shown a continuous downtrend.
-Tight monetary policy in the US. The US Federal Reserve has been imposing a tight monetary policy in the states to curb the increasing prices. Ex-governor of the RBI, Raghu Ram Rajan has said that the US has been showing signs of a mild depression's arrival. What will happen to the countries with which the US shares close trade ties when such a situation occurs?
The US Federal Reserve is gearing up to shock the market soon with a hike in interest rates by an aggressive 75 basis points in a bid to shake out inflation out of the American economy.
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