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Here are Some Measurable Impacts of Falling Rupee: MSME Perspective

Last few weeks rather few months we are witnessing a continuous fall of the rupee against the US Dollar. This fall has set a record low week after week. Now the situation has come that psychological pressure level of 80 to a dollar has come. Stay tuned for more on SMEStreet's special series on Possible Impacts of Rupee fall on Indian MSMEs .

SMEStreet Edit Desk

18 Jul 2022 05:21 IST

New Update

Last few weeks rather few months we are witnessing a continuous fall of the rupee against the US Dollar. This fall has set a record low week after week. Now the situation has come that psychological pressure level of 80 to a dollar has come.

While it is true that a falling currency worsens the imported inflation and can eventually hurt other macroeconomic fundamentals, the rupee has actually been very well-behaved so far.

Here is an expert analysis on the Rupee fall, consider this: Several other emerging market and even developed market currencies have fallen more than the rupee so far this year. This implies that while the rupee has lost its value against the greenback, it has actually gained against these currencies.

The rupee continues to stay in the middle of the EM pack, with its performance against the dollar lagging behind its peers from Indonesia and Malaysia but ahead of its South African counterpart.

Moreover, the rupee’s fall right now corrects its relative overpricing against a wide basket of currencies, which is also something to be happy about.

So, while the falling rupee could pinch your pocket somewhat, remember that this is part of a global trend when the surge in crude oil and commodities has pushed up inflation, even as a run for safety pushes up the dollar.

For more, we at SMEStreet will talk about this Rupee fall and it's possible impact on Indian MSMEs.

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