Rupee to Spur India Inflation as China Industries Slow: Economy

The Indian rupee’s slump to its weakest level since at least 1973 risks boosting inflation and spurring higher interest rates just as a manufacturing slowdown eases price pressures in neighboring China.

The rupee traded at 52.19 per dollar at 2:38 p.m. in Mumbai, bringing its decline in the past four months to 15 percent, the biggest drop among 10 Asian currencies tracked by Bloomberg. Reserve Bank of India Deputy Governor Subir Gokarn said in Mumbai the drop will have an “immediate impact” on the country’s inflation, which is the fastest among BRIC nations.