Many of you would instantly jump on me saying – what a ridiculous question? – Offcourse an appreciated Rupee is good for us any day.
Is it so?
I actually had this debate couple of days back with a friend of mine who is in USA – He literally gave me 10s of reason on why Rupee hovering around 50 is good, while I thought otherwise.
I am researching a bit and putting my thoughts together – will probably do a post in coming days, In the meanwhile, I would like to carry out a poll to see what do trak.in readers think.
[poll id=”10″]
Off course, your views and comments are always appreciated, they may also fuel / influence the post I plan on making.
what is the rupee outlook for the next year
Sir, Its a very good question and a Good debate topic.
Indian economy is among the fastest growing economies of the world. The appreciation of rupee against dollar will prove out to be another huge addition to its economic prosperity and growth story. However the economic epidemics like poverty, unemployment etc cannot be dealt in short run.
From 2003-08 Indian market was booming, today after china India is 2nd fastest growing economy of the world with registering a growth rate of 9%. India is a trillion dollar economy and has become world’s 12th largest economy (2008 estimate). Now major question drifting in every Indian mind is “Rupee Appreciationâ€. The rupee appreciated by 9.8% against the US dollar during the previous financial year between April 3 , 2007 to January 16 2008 which results in shutdown of many IT companies and foreign farms.
As i am working in IT Company i love to see “Rupee depreciation” ,but as a whole if ruppee is in between 42-50 comparing to dollar its good for indian economy.
Having taken a loan from india when 1$ = Rs 50 and paid back when 1$ =Rs 40, its really frustrating. I guess to keep all parties happy, exporters, software companies, people like me and for all good..I guess dollar locked at Rs 45 would be great.
The audience is really important in looking at the answer. If you ask the IT companies whose 60% or more of their revenues come from the US then yes the Rupee depreciation is good for them. Same is the case with any export oriented industries like textiles.
Rupee appreciation is good for folks who wants to buy foreign equipment which they save in rupees and spend in dollars. Many industries want this.
As a blogger, I like the dollar at 50 rupees. That would take care of few more bills. So selfish!
Hahaha @sriram, I know how I pray for dollar not to go down…yes because I am Adsense publisher, but looking at it objectively it is real tough what is good and what is bad from Macro perspective.. :)
The bigger perspective is when the rupee weakens against the dollar, exports increase (to earn dollars/euros which enable getting more rupees:)) thereby reviving the economy. Traditionally, China depreciated its currency to ramp up their exports although of late it changed its course of action and appreciated yuan against dollar.
As Sriram said, different industries / individuals have different requirements.
Take my case: As an MBA student in USA, when I wanted to take loan from India, I wanted a dollar at 40 rupees but when I would want to repay my loan in future, I definitely wish that every dollar gives me 50 rupees:)