Smart things to know about the rupee exchange rate

1. The exchange rate of a currency is its price in terms of another currency. A USD/INR rate of 65 means that the price of $1 is Rs 65.

2. The RBI publishes daily reference rates for the USD, the Euro, the Japanese Yen, and UK Pound Sterling. However, the USD/INR rate is the most widely tracked exchange rate in India.

3. The Rs /$ exchange rate is determined by market forces of demand and supply.

4. Exporters and global investors into India supply dollars; importers and global investors who take money out of India demand dollars.

5. When foreigners invest in India, and we have a good export growth, the rupee appreciates. When we import too much and foreigners sell off their investments in India, we have rupee depreciation.

(Content courtesy: Centre for Investment Education and Learning ( CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)