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Free fall of rupee (Impacts on Indian economy (High oil import costs,…
Free fall of rupee
Impacts on Indian economy
High oil import costs
Current Account Deficit
Inflation
Corporate revenue loss
Unemployment
Less foreign investment
Why in news
since start of 2018
rupee's value against dollar
fell by more than 5%
also other countries currency
Indonesia
Argentina
Mexico
Turkey
Causes
US Fed
to tighten monetary policy
= less dollar supply
= high demand for dollar
= less demand for other currencies
Way forward
RBI
monetary policy stance
Less benchmark interest rate
attract foreign investment
appreciate currency value
intervene
forex market