Over the past
few years, the value of Indian rupee has been plummeting fast against the US
dollar. And the falling value of a rupee means less export/import power in the
hands of people as well as the government. Which in turn makes the nation
financially weaker, hampering the prospects of international trade and currency exchange rates.
Here are a
few factors that change the dynamics of the Indian economy.
Crude oil: With the fast
development and growth of the Indian economy, the demand for petrol and
petroleum products has been consistently rising. India produces about 20% crude
oil we require, and the rest is imported from Saudi Arabia, Iran, and other
Gulf countries. Reputed oil companies of India require millions of dollars
every day in order to import crude oil and gas. Thus, the increase in the
demand for the dollar leads to its appreciation and decrease in the value of
the Indian rupees.
Trade
Tensions: The
policies of the US President have had an impact on the dollar as well as the International
Money Exchange forums. The administration’s decision to impose import
tariffs against China, Mexico, Canada, Europe, and Turkey is expected to stoke
US inflation, which would ultimately lead to the strengthening of the Dollar. A
strong dollar makes imports more expensive, and the escalating US-China trade
war is already rocking the forex market.
Indian
economy: The
failing graph of the Indian economy has also contributed to dwindling foreign
investments. This is primarily because the foreign investors do not find Indian
markets tone viable and lucrative anymore, owing to the rising costs of operations.
If you want to know other factors for Why Indian Currency is
Falling?, visit source blog.
Source: https://yourexpertguide.wordpress.com/2018/12/06/why-indian-rupees-continuously-falling-down/
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