Friday, November 18, 2011

India's Rupee: Asia's Worst-Performing Currency

The rupee has plunged 14%, making it the world's third-worst performing currency, after the Turkish lira and the Kenyan shilling. At $19.6 billion, the trade deficit is highest in four years.

This in turn has caused a jump in the current account deficit, or the trade deficit plus interest payments and other transfers. It reached $14.1 billion in the April-June quarter, from $12.0 billion a year earlier, amid lower receipts from software and other services.

India’s widening trade deficit

1 comment:

Non Carborundum said...

More evidence that Indian real GDP growth rate is zero to negative. Currency depreciation and inflation go hand in hand. Govt. figure of ~10% for inflation is fudged.

If the Rupee is depreciating against the dollar @14% and if commodities, including gold are rising against the dollar, then the Rupee is depreciating against commodities @>14% , say 20%. If nominal GPD growth rate is ~17%, then real GDP growth rate is (17-20)% or ~ minus 3%.