Video narration
Why does the same $1 price tag read ₹80 one time and ₹90 another? Think of it as a price tag: it tells you how many rupees buy the same dollar. Fewer rupees mean a stronger rupee; more mean a weaker one. From ₹85 to ₹80 per dollar, the rupee appreciates: imports and foreign travel become cheaper, while Indian exports can become less competitive, as buyers abroad may find them costlier. From ₹85 to ₹90, it depreciates: imports and travel become costlier, while exports can become more competitive. That's the market moving. For UPSC, appreciation and depreciation are market-driven; revaluation and devaluation are official changes in currency value under a fixed or managed exchange-rate system. Because the rupee's value against the dollar changes: ₹90 is a higher price tag for the same dollar. Quick check: if it moves from ₹82 to ₹88 per dollar, A, appreciation, or B, depreciation?