RBI warns that while a weaker rupee boosts trade短期, a stronger rupee is better long-term for India's economy.

The Reserve Bank of India (RBI) reports that while a weaker rupee benefits trade in the short term, a stronger rupee is better in the long run. The real effective exchange rate (REER) of the rupee has risen, indicating overvaluation. Despite this, the rupee's trade impact shows an asymmetric effect, where depreciation boosts trade more in the short term, while appreciation has a larger impact over time. The RBI suggests policymakers monitor these changes for financial stability.

3 months ago
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