3 things that make the Indian Rupee a good currency

01:21 Mins Read

Watch this video to find out what makes the rupee a good currency.

Transcript

As things stand in the first half of 2021, the Indian rupee has been the best performing Asian currency. What makes the Indian rupee a good currency? One key driving factor is the steady inflow of dollars into Indian equity market. This has, in turn, been driven by the liberal monetary and fiscal policies in the US, which promote investments in emerging economies. Another reason the Indian rupee is a currency to watch out for has to do with the Reserve Bank of India. While the RBI intervened heavily in this area in 2020, this year, the central bank has reduced its intervention, making the currency flow easier. And thirdly, the Indian rupee is only partially convertible. This essentially means there’s a cap on the amount of currency flowing into or out of the country. That makes the Indian rupee relatively less volatile. So, there you have it - three key reasons India’s rupee is a currency to watch. And with that, we bring this module to a wrap. But as always, keep reading, and keep learning with Smart Money!

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