The rupee’s depreciation has triggered concerns across markets, but the framing of this discussion needs a correction. What we are witnessing is not a fundamental weakness in the rupee but rather the overwhelming strength of the US dollar. The dollar index has been on a sustained appreciation cycle.Between October and February, the dollar index strengthened by about 6%. During the same period, the rupee depreciated by only 3.2%. That is a controlled move rather than an alarming fall.
.png)
