Currency Movement

Topics: Currency, Foreign exchange market, Macroeconomics Pages: 16 (3857 words) Published: March 27, 2013
Executive summary

The Indian rupee (₹) is the official currency of the Republic of India. The issuance of the currency is controlled by the Reserve Bank of India.

The modern rupee is subdivided into 100 paisa (singular paisa), although this division is now theoretical; as of 30 June 2011, coin denominations of less than 50 paise ceased to be legal tender. Banknotes are available in nominal values of 5, 10, 20, 50, 100, 500 and 1000 rupees. Rupee coins are available in denominations of 1, 2, 5, 10, 100 and 1000; of these, the [pic] 100 and [pic] 1000 coins are for commemorative purposes only; the only other rupee coin has a nominal value of 50 paisa, since lower denominations have been officially withdrawn.

The Indian rupee symbol [pic] (officially adopted in 2010) is derived from the Devanagari consonant "र" (Ra) with an added horizontal bar. The symbol can also be derived from the Latin consonant "R" by removing the vertical line, and adding two horizontal bars (like the symbols for the Japanese yen and the euro). The first series of coins with the rupee symbol was launched on 8 July 2011.

The Mahatma Gandhi series of banknotes are issued by the Reserve Bank of India as legal tender. The series is so named because the obverse of each note features a portrait of Mahatma Gandhi. Since its introduction in 1996, this series has replaced all issued banknotes. The RBI introduced the series in 1996 with [pic]10 and [pic]500 banknotes. At present, the RBI issues banknotes in denominations from [pic]5 to [pic]1,000. The printing of [pic]5 notes (which had stopped earlier) resumed in 2009.

As of January 2012, the new Indian rupee sign has been incorporated into banknotes in denominations of [pic]10, [pic]100, [pic]500 and [pic]1,000. INTRODUCTION

The Indian Economy is the eleventh largest economy in the world with a nominal GDP of US$1,235,975 million (IMF list). The Indian market has been booming in leaps & bounds. By 2008, India had established itself as the world's second-fastest growing major economy after China, with a growth rate of 9.4%. However, the year 2009 saw a significant slowdown in India's GDP growth rate to 6.8%. The Rupee hit a record low during early 2009 on account of the global recession. However, due to a strong domestic market, India managed to bounce back sooner than the western countries. Since September 2009 there has been a constant appreciation in Rupee versus most Tier 1 currencies. The exchange rate as on 30thOctober, 2010 is [pic]44.345 to the USD. A rising rupee prompted Government of India to buy 200 tonnes of Gold for $6.7 billion from IMF in 2009 as a total role reversal from 1991. Indian forex reserves stands at $294.01 billion (Oct, 2010).

What is Currency?

A generally accepted form of money, including coins and paper notes, which is issued by a government and circulated within an economy. Used as a medium of exchange for goods and services, currency is the basis for trade.

Any form of money that is in public circulation. Currency includes both hard money (coins) and soft money (paper money). Typically currency refers to money that is legally designated as such by the governing body, but in some cultures currency can refer to any object that has aperceived value and can be exchanged for other objects.

What is currency fluctuation?

Currency fluctuations are simply the ongoing changes between the relative values of the currency issued by one country when compared to a different currency.

The process of currency fluctuation is something that occurs every day and impacts the relative rate of exchange between various currencies on a continual basis.



In 1861, the government of India introduced its first paper money: 10-rupee notes in 1864, 5-rupee notes in 1872, 10,000-rupee notes in 1899, 100-rupee notes in 1900,...
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