Cheap rupee delivers, again

In March 2012, the rupee was about 51 to the US dollar - not much cheaper than it was a decade earlier. Through the latter half of 2012, exports continued to fall and soon the deficit on the current account (the sum of all trade, in both goods and services) was more than six per cent of GDP - over twice the danger level, and never reached before. The rupee came under pressure, reaching 54 by March 2013, then dropping to 57 in June and nearing 60 by mid-July - in part also because signals about a change in the US monetary stance encouraged an outflow of money.

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