Navigating the Rupee's Decline: Government's Watchful Eye
The government and regulators are closely monitoring the depreciating rupee, which recently fell below 90 against the US dollar. This decline raises concerns despite its export competitiveness. Efforts are underway to modify regulations, enhance foreign investment, and support Alternative Investment Funds (AIFs) to stabilize the currency.
- Country:
- India
As the rupee continues its decline, slipping below the 90 mark against the US dollar, the government and regulators are on high alert. Economic Affairs Secretary Anuradha Thakur expressed concerns about the currency's performance and its broader implications on the economy.
The depreciation, although potentially beneficial for export competitiveness, has raised alarms due to the currency's weakened status compared to peers like the Japanese yen and Southeast Asian currencies. The recent Economic Survey highlighted a 6.5% drop in its value over a year.
In response, the government's budget includes critical measures to bolster the currency, including regulatory adjustments for Alternative Investment Funds and expanded foreign investment limits, as announced by Finance Minister Nirmala Sitharaman.
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