The rupee has witnessed a significant fall in its value over the last few months. The depreciation of a host of emerging market currencies, not just the rupee, suggests that there is a global factor at play. The fall in the value of the rupee means that buyers are now having to shell out more rupees to purchase dollars. Further, as far as the depreciation of the rupee or other emerging market currencies was previously unexpected, it could affect the expected returns of people who invest across borders. The Reserve Bank of India can affect both the money supply and domestic interest rates simultaneously through its monetary policy stance.

Source: The Hindu May 12, 2018 15:38 UTC