[sbasak]

I am not talking of daily fluctuation. I mean long term valuations.
When I was in early classes in school, $ was Rs 13, £ Rs 16 or so. Now it has risen to Rs 43 & Rs 80 respectively.
Who decides the exchange rates? In spite of India's economy becoming better every year, why the rate never drops??

[RX135]

Originally Posted by sbasak

I am not talking of daily fluctuation. I mean long term valuations.
When I was in early classes in school, $ was Rs 13, £ Rs 16 or so. Now it has risen to Rs 43 & Rs 80 respectively.
Who decides the exchange rates? In spite of India's economy becoming better every year, why the rate never drops??

Rupee is actually appreciating these days. I remember it falling down to 49 Rs./Dollar at one time. Last I heard of, it is floating close to 41.

[finneyp]

Yes, Indian Rupees is getting stronger now!
Euro was Rs.58 a month back, but now it is around Rs.55

[typeOnegative]

Originally Posted by sbasak

Who decides the exchange rates? In spite of India's economy becoming better every year, why the rate never drops??

Exchange rates are not fixed artificially in India, unlike other countries like China, rather the rates get decided by the amount of trade, FDI, government policies etc.

The rate has been dropping esp. wrt dollar. But whether it is a desirable thing is another question.

[s0uljah]

Who knows a good place for me to buy $$

Lol

[lurker]

Now it is 40.88.

Days of ascendency of the dollar are fading. Nice time for you to make this thread. lol

[quicksilver]

You can get $ at any Forex dealer. But right now, you might want to buy the Re. instead as $ is not too strong these days. As we speak, it is at 40.83XXX

[manson]

India has managed foreign exchange rate system, the exchange rate is more or less determined by the demand and supply of any currency, and in times of emergency the monetary authority reserves the right to regulate the same.

Recently, most exporters have been having a bad time due to exchange rate of inr : usd falling, this from what i know is not due to the inr strengthening, this is more because of foreign exhchange flowing into our country due to a increased exchange rates, so due to excess supply of usd, its value has fallen v/s the inr.

manson.

[Steeroid]

Man here we are lamenting how few rupees we get these days and somebody has gone a posted a thread asking why does it fall!

If wishes were horses!

[manson]

Originally Posted by Steeroid

Man here we are lamenting how few rupees we get these days and somebody has gone a posted a thread asking why does it fall!

If wishes were horses!

Ditto steer, i feel ya on this one

manson.

[typeOnegative]

Originally Posted by manson

India has managed foreign exchange rate system

Is it true even now? Somehow I thought that the RBI is more focused on domestic monetary policy and the exchange rates get fixed based on other macro factors ....

[Samurai]

For our export driven economy, low rupee value against major currencies is a good thing. If rupee keeps getting stronger, all the IT/BT/ITES/Textile jobs will quickly leave our country.

Weak Rupee => Good for Export, bad for Import
Strong Rupee => Bad for Export, Good for Import

Unless we have very strong domestic market for our products, we are better off with weak rupee.

[Wimwian]

Originally Posted by typeOnegative

Is it true even now? Somehow I thought that the RBI is more focused on domestic monetary policy and the exchange rates get fixed based on other macro factors ....

It's still true to a certain extent... it's not controlled directly, but RBI controls it through forex market interventions... FDI inflows have been increasing dollar supply in the market which the RBI was sweeping up by selling rupees till about feb-march, thereby preventing the rupee from appreciating... however too much rupee supply was fueling inflation and RBI has since stopped under government pressure... which is why rupee is appreciating right now.

[tifosikrishna]

Originally Posted by Samurai

For our export driven economy, low rupee value against major currencies is a good thing. If rupee keeps getting stronger, all the IT/BT/ITES/Textile jobs will quickly leave our country.

Weak Rupee => Good for Export, bad for Import
Strong Rupee => Bad for Export, Good for Import

Unless we have very strong domestic market for our products, we are better off with weak rupee.

i dont see ITES jobs quickly leaving the country, a stronger ruppee means better buying power, hence salary may rise may not be as high as it is now, but with the same salary we will have a better purchasing power.

there are many other factors for ITES MNCs to setup base in India, low cost is just one of the reason.

yes, we have a strong domestic market as we are not as export dependent as countries in far east.

appreciation is good but should happen gradually, just think of the savings that we will make in just oil pool account because of the stronger ruppee..

[Deepz]

the dollar has been weakining this year particularly, not just against the indian rupee but against all other currencies also..there was a very drastic move in the forex market between feb and april 2007..