GROUP-5 Hemavani-1103014 Mohd Sarwar Hussain-1101050 Shivanand-1101089 Shanti priya-11030 Sharath chandhra-11030 Shruti-11030

Introduction
Rupee depreciation means that rupee has become less

valuable with respect to dollar.

A currency will tend to become more valuable when its

demand is higher than supply. It is the basic theory.

Rupee > 55.75

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Past Trend

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Reasons for depreciation

RBI
Foreign Direct Investment Foreign Institutional Investments

Demand and Supply of Dollar, Rupee

regulator participant

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Reasons (Cont.)
Rise in crude oil prices
sudden increase in gold investments by Indian savers

Euro Crisis= US benefited

Indias fiscal deficit widening

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Fish bone structure

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The current account is the account that

shows the imports and exports of goods and

services.

The capital account is the account that shows

the money invested by foreigners in India, and money invested by Indians outside the country.
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EURO CRISIS
Greece's problems Austerity drive: drastic spending cuts, tax rises, and

labor market and pension reforms.

If Greece does not repay its creditors, Italy & Spain will

be affected.
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Europe has two drastic choices:

To create one country by integrating budgetary policy

To separate to single currencies.

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HOW CURRENCY DECLINE MAY HURT ?

Investments
Imported items Foreign travel Education abroad
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WHO WILL BENEFIT?

Remittances Investments

Foreign tourists
Stocks

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Steps by Government
RBI allowing banks to set NRE deposits rate Rupee depreciated by 9% from January

Profit nullified
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How to tackle Rupee depreciation ?

Promote exports by cutting red tape

Focus on fast-tracking infrastructure projects

Face inflation

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Cont
Curbing fiscal and current deficit can also go a long

way in supporting rupee. Phasing out of subsidies in a gradual manner should reduce fiscal deficit eliminating the need of deficit financing and thereby excess money supply in the economy. Providing tax sops to exporters and access to cheap credit

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HOW YOU CAN PLAY THE RUPEE?

Currency futures

Mutual funds

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References
www.assocham.org articles.timesofindia.indiatimes.com

www.hindustantimes.com
www.cigionline.org

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