A 1% Increase in REER Could Boost India’s Exports by 1.07% in the Long Run: Exim Bank Study
A 1% Increase in REER Could Boost India’s Exports by 1.07% in the Long Run: Exim Bank Study
Exim Bank’s study indicates that a 1% increase in REER (indicating appreciation of the Indian Rupee) translates into a 1.07% increase in India’s real exports to the world. While conventional wisdom suggests that currency depreciation boosts exports by making goods more competitively priced in global markets, the counterintuitive finding of the study suggests that a weaker rupee may not necessarily deliver the anticipated boost to Indian export growth.
