India’s reverse taper

With bond yields shooting up and the rupee breaching levels last seen in mid-September, the currency is in for a fresh round of turbulence—and with it, oil subsidies and, to the extent of unhedged positions, India Inc’s balance sheet will also take a hit. Though exports have risen by double digits for the fourth straight month and imports remain flat thanks to gold remaining well under control—at $24 billion, April to October gold imports were 13% lower than in the same period of FY13—the rupee has continued to weaken. 

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