The Indian Rupee hit its all-time low a few days back, hitting against a dollar. The Indian currency has been battling with the increase in crude oil prices, posing a serious threat to the country’s finances. Considering the fact that India imports 80% of its crude oil, the rising trade deficit will be impacted more than one way. The rupee has fallen more than any other emerging-market currencies this year.
As it is believed, a weakened value of the rupee will provide some competitiveness to the exporters in India as dollar wise the products will become cheaper for the buyers. Thus, a weak currency can be advantageous to a certain set of players and detrimental to others. A weak rupee symbolizes a weaker Indian economy. But the volatility of a currency isn’t in anyone’s interest because it increases the hedging cost due to the involvement of uncertainty.
Exporters will benefit from the weakening of the rupee. Furthermore, it will lead to reviving the economic growth.( DOWNLOAD TO KNOW MORE )