Fascinating History of Indian Rupee vs US Dollar: INR to USD Exchange Rate Over the Years {update}

Once India started opening up and growing, then the consumption of foreign products began to rise, and with this the demand for foreign exchange. This put much pressure on the Rupee and the government had to change this in its value several times. The starting of gradual depreciation was witnessed since the early 1960s.

INR to USD Currency Exchange Rate – 20 Year Graph

Historical Indian Rupee Rate (INR USD)

1947 – 1951: Post-Independence Stability

1952 – 1956: Fixed Exchange Rate

1957 – 1961: Continued Stability

1962 – 1966: First Major Devaluation

1967 – 1971: Post-Devaluation Adjustment

1972 – 1976: Rising Inflation and Depreciation

1977 – 1981: Inflation and Global Pressures

1982 – 1986: Gradual Depreciation

1987 – 1991: Pre-Reform Years and Major Devaluation

1992 – 1996: Economic Liberalization and Market Reforms

1997 – 2001: Asian Crisis and Stabilization

2002 – 2006: Post-Crisis Recovery

2007 – 2011: Global Financial Crisis and Aftermath

2012 – 2016: Rupee Depreciation and Volatility

2017 – 2021: Fluctuations Amid Global Uncertainty

2022 – 2023: Recent Trends

Major Changes in the 1990s

The decade of 1990s is considered as a new era for the economic front of India. India’s external sector was under monumental pressure in 1991 due to a balance of payment problem which made the Rupee to depreciate. In order to prevent the escalation of the crisis, the government was forced to launch the series of the liberalizations which made the Indian market open for foreign investments. The Rupee was devalued so as to make the exports made by India competitive in the international market.

The exchange rate of 1991 was 17.90 INR for 1 USD. for the next decade the value depreciated and in the year 2000 1 USD was equivalent to about 44 INR. It was somewhat attributed to inflation, growing need for foreign exchange, and integration of India to the Global economy since liberalization in the early 1990s.

The Effect of World Financial Crisis

The year 2008 global financial crisis affected all the world economy and of course was indicative of the India economy. One of the major currencies to be affected was the Rupee that stared depreciating and to the worst hit it fell drastically. For the year 2008 the value of 1 USD was approximately equal to 39 INR. However, it had turned to 46 INR upon the year 2010.

As the global markets become more unpredictable, the safe haven currency of choice was the US Dollar. This consequently led to an even worse situation for the Rupee and more so the Dollar – for the Rupee.

2010s: Fluctuations and Volatility

As for the exchange rate fluctuations the latter part of the 2010s experiences the volatility that Bangladesh faced in late 2000s, the Indian Rupee reached its lowest record in year like 2013 when one dollar tried to touch 68.80 Rupees in India. This was due to other factors like the cut down in the quantitative easing program by the US Federal Reserve and a consequent emergence market funds outflow, particularly India.

In the given period, the Indian government and the Reserve Bank of India (RBI) made following measures to begin to stabilize the Rupee: a) increase in the rates of interest b) capital controls. Preliminary solutions offered some help though the Rupee kept on oscillating.

Recent Trends

The last few years have witnessed further decline in respecting the US Dollar from India Rupee. Currently the exchange rate is 1 USD = 82 INR as of 2023. The following are some of the reasons that may have led to this trend; the trade deficit in India, world economic declines and horrible oil prices. This was also the case in the COVID-19 pandemic when all economies were affected and there was unpredictable in markets.