RBI Data
Rupee's real effective exchange rate falls to 8-month low of 104.82 in Jan
This story was originally published at 21:38 IST on 19 February 2025
Register to read our real-time news.Informist, Wednesday, Feb. 19, 2025
--CONTEXT: Real FX rate index for trade-weighted, 40-currency basket
--RBI: Rupee effective FX rate index 104.82 in Jan vs 107.13 in Dec
NEW DELHI – The rupee's real effective exchange rate against a basket of 40 currencies, in terms of trade-based weights, fell to an eight-month low of 104.82 in January from 107.13 in the previous month, according to the data released by the Reserve Bank of India on Wednesday.
After touching a record high of 108.14 in November, the signficiant correction in the REER comes following a sharp depreciation in the rupee against the dollar.
The Indian currency depreciated almost 1.2% against the dollar in January owing to strong foreign outflows, weakness in the yuan and dollar demand from importers. FPIs withdrew almost $6.68 billion on a net basis from India in January.
Moreover, the RBI showed tolerance to a depreciating rupee and intervened in the foreign exchange market less heavily than before, likely to allow the Indian currency to be competitive among its Asian peers. As a result, the rupee was the worst performer among its emerging market peers last month.
"In terms of the 40-currency real effective exchange rate, the INR (rupee) depreciated by 2.2% (month-on-month) in January 2025, due to depreciation of the INR in nominal effective terms and negative relative price differentials," according to a paper by central bank staff on the State of the Economy in the RBI monthly bulletin.
The 40-currency basket includes the currencies of Angola, Australia, Bangladesh, Brazil, Canada, Chile, China, Egypt, the European Union, Ghana, Hong Kong, Indonesia, Iran, Iraq, Israel, Japan, Kenya, Kuwait, Malaysia, Mexico, Nepal, Nigeria, Oman, Qatar, Russia, South Korea, Saudi Arabia, Singapore, South Africa, Sri Lanka, Switzerland, Taiwan, Tanzania, Thailand, Turkey, Ukraine, the United Arab Emirates, the UK, the US, and Vietnam.
End
US$1 = INR 86.95
Reported by Pratiksha
Edited by Deepshikha Bhardwaj
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
