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Dynamics of the exchange rate in India

Rabia Najaf, Khakan Najaf

Abstract


Exchange rate is act as the main role in the integral part of the economic development. India is also facing this issue like the other Asian countries impact of increase exchange rate on the growth of the economy. It is source of the external funds and act as the channel between risk and investment. In this research, we have taken the data from 1998 to 2008 and applied the ADF test, normality test and Jarqu e-Bera statistics test for taking the proper results about the impact of exchange rate on the development of India. Normality test explains the nature of the data. Our results showed that increase exchange rate has negative impact on the stock exchange of India. We suggest that the government should focus on the exchange rate policy.

References


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