IMA Analysis

Friday August 31, 2018

Currency Turmoil

Despite reasonably good macroeconomic conditions, India’s currency has declined by over 10% since the start of 2018. The reasons for this, as we have argued in recent briefings, stem largely from global considerations including the tightening of US monetary policy and the Trump administration’s tax reforms. Going forward, emerging market currencies including the rupee are likely to remain volatile as the risks of escalating trade tensions and the reversal of the dollar carry trade weigh upon the global economy.

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