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Indian Rupee: One Of The Worst Performing Currencies

The rupee is still overvalued, according to the 36-country Real Effective Exchange Rate calculation after adjusting for inflation

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Indian Rupee: One Of The Worst Performing Currencies. flickr

The Indian rupee’s plunge to an all-time low of 69.09 against the US dollar, compared to the previous low of Rs 68.865 in November 2016 reflects the ill-effects of US President Donald Trump’s disastrous economic policies on the world at large. Indeed, American protectionism through higher import duties coupled with the consequences of renewed US sanctions against Iran is indeed playing havoc with economies across the world. That the rupee has fallen by more than eight per cent over the last one year is not good news for India, though, there is a silver lining in terms of the possibility of higher exports. The hard reality is that the rupee is one of the worst performing currencies in the world and the consequences of American policies could make things worse.

Not only have foreign institutional investors been pulling out funds from the Indian market, having withdrawn a whopping Rs 46,197 crore in three years, the spectre of higher crude prices due to the sanctions against Iran could disturb the applecart further considering that India depends heavily on crude imports to meet its oil needs. If there is any consolation at all for the rupee’s plunge, it is that most emerging market currencies are crashing.

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Indian currency notes. Pixabay

Also read: Crores of rupees being spent on defunct websites of Municipal Corporation of Delhi

The Reserve Bank’s prop by selling US$400 to 500 million in one-month futures contracts has saved the day for India. Almost an equal amount has been sold through Mint Street. Mercifully, a weak rupee need not be necessarily bad for the Indian economy. The rupee is still overvalued, according to the 36-country Real Effective Exchange Rate calculation after adjusting for inflation. As of May, the over-valuation was 14.67 per cent. This could give exports a boost which is a silver lining. There is also a Moody’s report which says that India is one of the five countries that are least vulnerable to currency pressures amid strengthening of the US dollar due to low dependence on external capital. But the downside is that as US interest rates go up, investors who borrowed at a cheaper rate would find returns from investing in India not worth the risk. On balance, major economic challenges lie ahead of India meeting with would be no mean task. (IANS)

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Partial Shutdown of US Delays Space Missions, But NASA Not Grounded

Other active space missions includes NASA probes OSIRIS-REx and New Horizons spacecraft that continue to gather data in Earth orbit and the Moon, Mars, Jupiter and beyond, the report said

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People rally to call for an end to the partial government shutdown in Detroit, Thursday, Jan. 10, 2019. VOA

The partial shutdown of the US federal government has had a serious impact on the country’s space agency NASA and development work on most future space missions has been slowed or suspended.

However, NASA has not been totally grounded by the partial government shutdown that began on December 22, after last-minute negotiations in Congress failed to end a budget standoff.

Over 95 per cent of the space agency’s employees have been furloughed. As a result, various research projects, including the Hubble Space Telescope has been put on hold, the Space.com reported on Wednesday.

Hubble suffered a mechanical problem that only furloughed NASA employees could repair.

Many workers also gathered outside the Johnson Space Center in Houston to protest the shutdown and its deleterious effects on their lives and the nation’s space programmes.

The Telescope facilities that have so far remained open during the shutdown will soon run out of money and cease operations.

This includes the National Radio Astronomy Observatory (NRAO), a federally funded organization that operates the Atacama Large Millimeter Array (ALMA), the Green Bank Telescope and the Very Large Array (VLA), the report noted.

The partial shutdown become the longest on record after January 12, overtaking the previous record of the 21-day impasse in 1995-96 under then President Bill Clinton.

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US shutdown delays space missions but NASA not grounded: Report,

President Donald Trump and the Congress have been at loggerheads over his demand to include in the budget $5.7 billion funding for building a border wall along the Mexico border. Democratic leaders have rejected his call.

NASA’s Stratospheric Observatory for Infrared Astronomy (SOFIA), also called the “flying telescope” has also ceased operations since the shutdown.

The telescope, which is mounted to the fuselage of a Boeing 747 aircraft, has not flown since the shutdown began, the report said.

However, despite the shutdown some “excepted” employees remained at work, assisting astronauts aboard the International Space Station (ISS) and other space missions, the report said.

Also Read- National Clean Air Programme Should Set Higher Targets

Last week, astronauts aboard the ISS conducted a range of scientific experiments and public-outreach work. They engaged in an orbital Q&A with school kids and answered a variety of questions, from the nature of the research performed aboard the ISS to the type of training astronauts receive to whether your ears pop in space.

On January 13, a SpaceX Dragon cargo capsule departed the orbiting lab for Earth, eventually splashing down in the Pacific Ocean. The robotic Dragon brought down important scientific research and hardware for examination here on terra firma.

Other active space missions includes NASA probes OSIRIS-REx and New Horizons spacecraft that continue to gather data in Earth orbit and the Moon, Mars, Jupiter and beyond, the report said.  (IANS)