Chief Economic Advisor (CEA) V Anantha Nageswaran stated that the rupee has only depreciated against the dollar, but has strengthened against all other major currencies of the globe at a time when it has reached a psychologically significant level of 80.
He continued, that, in contrast to prior crises, the rupee's decline versus the US dollar was less than that of other significant world currencies including the Swiss franc, Euro, British pound, and Japanese yen. He claimed that as monsoon season approaches and crude oil prices fall, inflation is anticipated to reduce.
“Even though it has depreciated by 7 per cent against the dollar, I would rather urge you to look at it as a dollar appreciation and not rupee depreciation. Because rupee is not the only currency that has depreciated,” Nageswaran said addressing the 186th Annual General Meeting of the Madras Chamber of Commerce and Industry (MCCI). “This time the rupee has declined only against the dollar but has strengthened against other major currencies,” he added.
“Even though it has depreciated by 7 per cent against the dollar, I would rather urge you to look at it as a dollar appreciation and not rupee depreciation. Because the rupee is not the only currency that has depreciated,”
The depreciation of the rupee and other currencies versus the US dollar, according to him, was primarily caused by the US tightening of monetary policy. "I believe that there is plenty to be thankful for and little need to worry about the Indian economy. The US Federal Reserve will meet again this week, and it is anticipated that they will decide to increase interest rates. In several nations, interest rates have been climbing. Even though many of us are concerned about the RBI raising interest rates, India's increase is comparatively more modest and lower than that of other countries, he continued. At its upcoming monetary policymaking meeting, the Fed is anticipated to raise its benchmark interest rate by at least 75 basis points.
He continued, that, in contrast to prior crises, the rupee's decline versus the US dollar was less than that of other significant world currencies including the Swiss franc, Euro, British pound, and Japanese yen. He claimed that as monsoon season approaches and crude oil prices fall, inflation is anticipated to reduce.
“Even though it has depreciated by 7 per cent against the dollar, I would rather urge you to look at it as a dollar appreciation and not rupee depreciation. Because rupee is not the only currency that has depreciated,” Nageswaran said addressing the 186th Annual General Meeting of the Madras Chamber of Commerce and Industry (MCCI). “This time the rupee has declined only against the dollar but has strengthened against other major currencies,” he added.
“Even though it has depreciated by 7 per cent against the dollar, I would rather urge you to look at it as a dollar appreciation and not rupee depreciation. Because the rupee is not the only currency that has depreciated,”
The depreciation of the rupee and other currencies versus the US dollar, according to him, was primarily caused by the US tightening of monetary policy. "I believe that there is plenty to be thankful for and little need to worry about the Indian economy. The US Federal Reserve will meet again this week, and it is anticipated that they will decide to increase interest rates. In several nations, interest rates have been climbing. Even though many of us are concerned about the RBI raising interest rates, India's increase is comparatively more modest and lower than that of other countries, he continued. At its upcoming monetary policymaking meeting, the Fed is anticipated to raise its benchmark interest rate by at least 75 basis points.
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