AUTHOR: Ashima Goyal and Krittika Banerjee
TITLE: How far is the Indian nominal exchange rate from equilibrium?
Abstract: Examining misalignments from equilibrium exchange rates for eight key emerging markets does not find evidence of systemic overvaluation. Swings associated with global events suggest changes are driven more by surges in global capital. The Indian equilibrium nominal rate depreciated since 2012 despite real appreciation but the range of 68-71 for INR/USD was close to equilibrium in 2018.
Keywords: Nominal exchange rate; Misalignments; India; Emerging market Economies
JEL Code: F31, F41