Rupee - Dollar Fluctuation

Abstract

Rise in import bills, costlier foreign education and travel are the result of Weak Indian Rupee. The impact comes from study increase of petrol and diesel prices throughout the year. This paper brings to light the impact of Rupee-Dollar fluctuation on Indian economy. The present risky environment is created on Indian economy is due to depreciation of rupee against dollar. It shows that there is a strong and significant negative impact of the currency volatility across sectors. The relationship between the values of local currencies in terms of foreign currencies and export competitiveness of any country is very difficult. During the last one year, Indian rupee weakens many times and reached to a lowest level. Indian economy already suffered a lot from large fiscal and current account deficit and adversely affected by relatively exchange rate pressure. To bring back again many hard decisions has to be taken by the regulator authority. This paper presents different challenges the economy faces due to the fluctuation and steps triggered by the central bank and government to create stability..