Indian Rupee May Spell Trouble For the US Dollar, Expert Warns

Juhi Mirza
BRICS US dollar USD Indian Rupee INR
Source: Reuters / ShutterStock

The weakening of the US dollar has been a noteworthy development as of late. The currency is now standing at a precarious threshold, with strong contenders like the Kenyan shilling challenging its authority. 

With the US debt crossing $30 trillion, it seems that the US dollar is gradually heading towards a downward spiral. Amid all this, the Indian economy may further the USD’s demise if it adopts one simple elemental change in its economic strategy, which is bolstering its foreign connections. 

Also Read: Currency: US $1 Trillion Debt Shows No Signs of Stopping

Can INR Beat the USD?

us dollar king crown usd currency bill brics
Source: Watcher Guru

The Indian rupee is far below in terms of valuation when compared to the USD. The INR fell to an all-time low against the USD, down by 83.28, spurred by rising geopolitical tensions. 

However, one analyst seems to have a different view of this critical situation. Macroeconomics expert Jesse took to X to outline his views on how the INR can truly outpace the USD in the near future. 

Speaking about the development in detail, Jesse emphasized how the BRICS alliance might be the biggest farce that the world has ever encountered. However, he later stressed how India and its steady economic progress are indeed making waves on a global scale. 

Jesse later acknowledged India’s gradual economic progress and shared how its bolstering economic progress can end up threatening the USD further ahead. 

The macroeconomist was quick to issue a new prediction, adding that if India continues to bolster its FDI, it could soon gain strength against the USD. 

Also Read: Currency: U.S. Dollar Falls Against The Chinese Yuan

“Also, the rupee’s trade against USD could improve dramatically if #FDI (foreign direct investment) increases over the next decade, which I believe is very probable.”

FDI, or foreign direct investment, simply refers to a development where a company takes control of the ownership of a business in another country. This would significantly boost the prospects of the investing country, bolstering its collective strength and stance. 

“FDI is a key element in international economic integration because it creates stable and long-lasting links between economies.” 

Why is the USD down?

The US dollar is standing at a weaker threshold, spurred by the rise of the multipolar currency system. The supremacy of the dollar is now being challenged by multiple currencies, notably the Yuan, INR, Kenyan shilling, and the Ruble. 

This development is not new, as calls for de-dollarization have been echoed for centuries. However, rising geopolitical tensions and inimical neighboring countries and relations have now started to dampen the USD’s global prestige. 

The stance has further gained prominence after Russian Prime Minister Vladimir Putin called the Middle East oil producers to ditch US dollars. Similarly, Putin has long advocated for regional currencies to take the lead when dealing with cross-border financial transactions and deals.