Indian Foreign Exchange Market: Crude Oil price fluctuation and Foreign Exchange Volatility

2. Indian Foreign Exchange Market

3. Presenting Contents
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Indian Foreign Exchange Market
Determinants of Exchange Rates
Forex Volatility
Crude Oil
Why India?

4. Indian Foreign Exchange Market
 Regulated by the Reserve Bank of India through the Exchange
Control Department
 Annual turnover - $400 billion
 Main centre - Mumbai
 Other centres - Kolkata, New Delhi, Chennai, Bangalore, Pondicherry
and Cochin
 Regulated by the Foreign Exchange Management Act, 1999 or FEMA
 Until 1973 - Foreign Exchange Regulation Act ,1947 or FERA
 Until 1999 - Foreign Exchange Regulation Act,1973 and gradually, this
act became as FEMA

5. Determinants of Exchange Rates
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Balance of trade
External Dept
Terms of Trade
Inflation
Interest Rates
Govt. Dept to GDP
IND Govt. External Debt

6. Determinants of Exchange Rates - Balance of trade

7. Determinants of Exchange Rates - External Dept

8. Determinants of Exchange Rates – Terms of Trade

9. Determinants of Exchange Rates - Inflation

10. Determinants of Exchange Rates- Interest Rates

11. Determinants of Exchange Rates- Govt. Dept to GDP

12. Determinants of Exchange Rates – IND Govt. External Debt

13. Determinants of Exchange Rates – Balance of Trade Comparison

14. Forex Volatility
• Theoritical Understanding
• Exchange Rate: INR_USD & INR_GBP
• Volatility Comparison

15. Forex Volatility – Theoritical Understanding
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Devaluation and Revaluation
Devaluation refers to a purposeful or even premeditated decline in
value of a currency in relation to other currencies. Most of the time,
these devaluations are demanded by government entities.
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Depreciation and Appreciation
There are also occasions when the value of a foreign currency
changes due to market fluctuation rather than through purposeful
intervention by a government's central bank. When these occur, they
are described as the currency either appreciating or depreciating.

16. Forex Volatility – INR_USD & INR_GBP

17. Forex Volatility - Comparison

18. Crude Oil
• Demand
• Price Fluctuation

19. Crude Oil - Demand

20. Crude Oil – Price Fluctuation

21. Should we consider India?

22. Why India?
• Indian GDP
• Present Ranking
• Estimated Ranking

23. Why India? - Indian GDP

24. Why India? - Present Ranking

25. Why India? – Estimated Ranking

26. We thank you -