The Economic Survey 2013-14, presented today in the Lok Sabha by the Union Finance Minister Shri Arun Jaitley, has noted that the annual average exchange rate of the rupee went up from ₹ 47.92 per US dollar in 2011-12 to ₹ 54.41 per US dollar in 2012-13 and further to ₹ 60.50 per US dollar in 2013-14. The large depreciation of the rupee during the course of the year, notwithstanding sizeable accretion to reserves in 2013-14, could partly be attributed to frictional forces and partly to the role of expectations in the forex market. The rupee has stabilized recently, reflecting an overall sense of confidence in the forex market as in other markets.

Annual average exchange rate rise signals forex market volatility and later stabilization reflecting renewed market confidence The Economic Survey records a sequential rise in the annual average exchange rate of the rupee, attributes the pronounced depreciation during the year partly to frictional forces and partly to market expectations despite sizeable reserve accretion, and notes recent stabilization reflecting increased market confidence.