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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Not only have foreign institutional investors been pulling out funds from the Indian market, having withdrawn a whopping Rs 46,197 crore in three years, the spectre of higher crude prices due to the sanctions against Iran could disturb the applecart further considering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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Local News Dry up for Facebook Media Project in US

In January this year, the Facebook Journalism Project announced to invest $300 million in local newsrooms

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A photo shows the Facebook app icon on an iPhone in New York, Feb. 19, 2014. VOA

Facebook is having trouble finding enough local news to feed its new journalism initiative, because hundreds of newspapers have shut down in the US.

“About one in three users in the US live in places where we cannot find enough local news on Facebook to launch ‘Today In’,” Facebook wrote in a blog post on Monday.

In those “news deserts” – communities with little or no local reporting – Facebook hasn’t been able to find “five or more recent news articles directly related to these towns” for its news feature “Today In” that was launched in November last year.

“In the last 28 days, there has not been a single day where we’ve been able to find five or more recent news articles directly related to these towns.

“This does not vary much by region: 35 per cent of users in the Midwest, Northeast, and South — and 26 per cent in the West a” live in places where we can’t find much local newson Facebook,” said the social networking company.

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This photo shows a Facebook app icon on a smartphone in New York. VOA

“Today In” has been rolled out to over 400 cities in the US.

“We’re also announcing a new pilot programme, the Facebook Journalism Project Community Network, to support projects aimed at building community through local news,” said Facebook.

Also Read- Dell and Alienware to Launch New PC Gaming Devices to India

According to Engadget, nearly 1,800 papers have shut down in the US since around the time Facebook came online 15 years ago.

In January this year, the Facebook Journalism Project announced to invest $300 million in local newsrooms. (IANS)