Zico Dasgupta
Articles by Zico Dasgupta

Number Theory: Why rupee depreciation is bad, not good news

Any currency depreciation may trigger two opposite effects on the domestic economy - an inflationary impact which occurs through an increase in the cost of importable goods, and a positive impact on the economy if it makes exports cheaper in global markets and imports costlier in domestic market.

Since a country typically trades with multiple foreign partners, the relevant indicators for exchange rate analysis of the rupee is India’s weighted average bilateral exchange rates with respect to its trade partners. (Bloomberg)
Since a country typically trades with multiple foreign partners, the relevant indicators for exchange rate analysis of the rupee is India’s weighted average bilateral exchange rates with respect to its trade partners. (Bloomberg)
Updated on Aug 09, 2022 01:42 PM IST
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