Economy: Rupee depreciation and appreciation explained with oil and FDI
📝Rupee Depreciation: Suppose oil prices suddenly increase → India has to pay more dollars for the same oil → Demand for dollars shoots up But supply of dollars hasn’t increased ↓ Now people are ready to give more rupees to get 1 dollar Earlier: $1 = ₹80 Now: $1 = ₹90 → Rupee has depreciated Impact: Imports costly → fuel ↑ → inflation ↑ 📝Rupee Appreciation: Suppose a lot of foreign companies invest in India → They bring dollars into India → Supply of dollars increases ↓ Now dollars are easily available ↓ You need fewer rupees to buy 1 dollar Earlier: $1 = ₹80 Now: $1 = ₹70 → Rupee has appreciated Impact: Imports cheaper → inflation ↓But exports become less competitive Let me know if you need any other topic explained!
Pratiksha Rathi · 4mo ago
Money supply
Simran Singh · 4mo ago
Thanks for sharing ma'am, I've been following this series