19.1 C
Saturday, March 25, 2023

Economic Survey sees Rupee under stress


Share post:

New Delhi: Noting that Indian Rupee (INR) has performed better than most currencies, Economic Survey 2022-23 has said that the challenge of the depreciating rupee persists amid chances of further increase in policy rates by the US Federal Reserve (US Fed).

The key economic document tabled in Parliament on Tuesday by Finance Minister Nirmala Sitharaman further said that widening of the current account deficit (CAD) may also continue as global commodity prices remain elevated and the growth momentum of the Indian economy remains strong.

“The loss of export stimulus is further possible as the slowing world growth and trade shrinks the global market size in the second half of the current year,” the Survey said.

Meanwhile, the Indian rupee fell as much as 52 paise to 82.04 against the US dollar in intra-day trade on Tuesday.

The Survey said that with monetary tightening, the US dollar has appreciated against several currencies including the rupee but the Indian currency has been one of the better-performing currencies worldwide. It noted that the modest depreciation rupee underwent may have added to the domestic inflationary pressures besides widening the CAD.

“Global commodity prices may have eased but are still higher compared to pre-conflict levels. They have further widened the CAD, already enlarged by India’s growth momentum. For FY23, India has sufficient forex reserves to finance the CAD and intervene in the forex market to manage volatility in the Indian rupee,” the Survey pointed out.

The Economic Survey said that the slowing global demand will likely push down global commodity prices and improve India’s CAD in FY24.

“However, a downside risk to the Current Account Balance stems from a swift recovery driven mainly by domestic demand, and to a lesser extent, by exports,” the Survey said.

It added that the CAD needs to be closely monitored as the growth momentum of the current year spills over into the next.


Please enter your comment!
Please enter your name here

Related articles

Threat of Ganga, Indus drying up increases

A conference on fresh water is about to take place in New York, USA after 5 decades. Prior...

Joint families increasing rapidly in USA, 23 percent youth living with grandparents

While India and many other countries have been following the trend of ‘westernization’ for decades now, which has,...

Private hospitals all across Rajasthan go on strike against Right to Health Bill

Private hospitals all across the state of Rajasthan have gone on a strike, in order to showcase their...

Rahul Gandhi tore ordinance 10 years ago, now disqualified from LS

10 years ago, on 27th September, 2013, Rahul Gandhi had torn a copy of an ordinance during a...