Two years after the taper tantrum: how does India fare now?

Two years ago this month the rupee entered a prolonged plunge against the US dollar amid the “taper tantrum”, eventually falling to an all-time low. But in the event of external financing conditions taking another turn for the worse, India’s lower current account vulnerabilities, reduced reliance on volatile portfolio inflows and greater stock of FX reserves mean a repeat of the turbulence of 2013 seems unlikely.

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