Rupee’s Record Lows Mask Currency’s Trade-Weighted Overvaluation
- REER gauge rose to more than six-year high of 107.33 in July
- The currency has underperformed Asian peers in August so far
The rupee is hovering near 84 to a dollar, and is down 0.9% so far this year, but on a REER basis, it’s up 3.6% in seven months to July.
Source: Bloomberg Creative Photos
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A gauge showing the Indian rupee’s value against its key trading partners rose to the highest in more than six years in July, even as the currency hit a new lifetime low against the dollar.
The index measuring the rupee’s value against a weighted basket of the country’s 40 trading partners, adjusted for inflation, rose to 107.33 — the highest since December 2017, according to the Reserve Bank of India data.