Why INDIAN RUPEE(INR) is compared with USD?
USD is a Universal Currency. Globally Commodities are traded using USD. So when India has to trade in the global market, it will have to BUY USD. For Buying USD, it will have to sell INR. Thus we need to know, how much INR will India have to sell to buy USD that it requires. The best way to do is, check for 1 Unit of USD. 1 USD = 48 INR Then if India wants to buy 100000 USD how much INR will it have to shell out. The more the cost of USD, the more the WEAK is the Indian Currrency. Exporters and Importers use exchange rate as a part of daily business routine. Exporters get payments in USD, they sell them to RBI and RBI gives them INR in return. Importers need to make payments in USD. so they buy USD from RBI and RBI in turn charges them INR equivalent to the USD bought.
