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The Indian rupee recently fell below the 90-mark against the US dollar, sparking concerns from opposition parties and raising questions about the impact on ordinary citizens. Experts noted that a weaker rupee benefits exporters and the IT sector by improving competitiveness but makes imports costlier, fueling inflation and squeezing corporate margins.

Inflation is not a very big concern within the system now, lowers the likelihood of second-order negative shocks that might otherwise accompany a move of this magnitude.

Such a policy can be operationalized by adding a quantitative clause to whatever inflation target measure or formula mandated

Bond investors have raised concerns that Kevin Hassett, a leading contender to replace Jerome Powell, may push for aggressive rate cuts aligned with President Trumps preferences. Treasury officials were briefed by major Wall Street players, who worry Hassett could prioritise political objectives over market stability and the Feds inflation mandate.

Nilesh Shah, a veteran in the MF space, added that a 2-3 per cent depreciation in the rupee is natural given the imbalances.

A weaker rupee makes imports more expensive, increases inflation risks and raises costs for companies dependent on foreign goods, especially fuel and machinery.

India's Chief Economic Advisor V Anantha Nageswaran expresses hope that the rupee should improve next year.

Nageswaran said he is not 'losing sleep' over the weakening of the domestic currency as long as it is not hurting exports

After the rupee weakened beyond the key psychological level of 90 per dollar, Chief Economic Advisor V. Anantha Nageswaran said he is not concerned, noting that the currencys slide is not affecting inflation or exports.

India's services sector saw strong growth in November, boosted by domestic demand. However, export sales experienced their slowest expansion in eight months. This divergence highlights robust local consumption. Input cost inflation eased significantly, supporting expectations of an interest rate cut. Employment growth remained modest, and business confidence dipped amid competitive pressures.