Stock markets have fallen sharply and concerns are being raised about a slowdown in economic growth momentum in the backdrop of a sharp rupee depreciation, while worries are also mounting about further surge in inflation.
However, a weaker rupee could mean good news for the NRIs and others remitting money from abroad to their families back in India, as also for those having invested in overseas mutual funds and the expatsworking in India with income in foreign currencies like the US dollar and expenses in rupee.
The rupee on Tuesday hit a record low of Rs 52.73 against the US dollar, as investors exited from riskier emerging markets as well as eurozone assets, and made their bet on dollar - which is seen as a "safe heaven" at times of crisis.
Some recovery was seen in the rupee this morning, but it remained above the 52-level and the analysts believe a further drop was still a possibility. The experts say that there are chances of a fall to as low as 55-level, as emerging market currencies are quite vulnerable to the eurozone debt crisis.
Amid a plunge in rupee value, the stock market tanked today with a fall of over 500 points in the benchmark Sensex during the intra-day trade.
But weaker rupee turns out to be good for those who depend on remittances from abroad, as the Indian currency has not only slipped against the dollar, but also against most other major currencies like the euro, British pound, Australian dollar and Kuwati dinar.
One US dollar gets a little over Rs 52 now, which is nearly 17 per cent more than what it did at the beginning of the year, similarly the British pound brings Rs 81, (up 16 per cent), euro brings Rs 70.19 (up 17.27 per cent) and Australian dollar Rs 50.90 (up 11.30 per cent).
Besides, for those people who are planning a visit to India now, are cheering as they will get good bargain for their home country currencies here. That gives them more spending power in this country than other favorite destinations like Singapore and Thailand.