Significant volumes of money move between the United States and India regularly. In 2016, more than U.S. $10.65 billion was sent from the U.S. to India as remittances, and around U.S. $6 million was sent in the opposite direction. Bilateral trade of goods and services between the two countries amounted to around U.S. $126 billion in 2017.
Comparing dollar to rupee exchange rates provided by different overseas money transfer companies is crucial if you plan to send money from the U.S. to India or the other way around. For example, if you compare exchange rates offered by XOOM and Remitly, you will notice that the latter tends to fare better than the former more often than not.
Here are exchange rates provided by Remitly and Xoom on 9 August, 2018.
USD to INR Remitly: $1 = Rs 68.67
USD to INR Xoom: $1 = Rs 67.26
As you can see, the dollar to INR Remitly rate is better than the dollar to rupee rate provided by Xoom. Incidentally, while the Remitly USD to INR rate is typically better than the Xoom USD to INR rate, it might be worth your while to compare their rates with better alternatives such as WorldRemit and TransferWise.
The United States has used the dollar in its current form as its official currency since 1792. The U.S. dollar is also used as the primary currency in the Caribbean, two British Overseas Territories, the Federated States of Micronesia, Turks and Caicos Islands, the British Virgin Islands, El Salvador, and Ecuador. Its use together with other currencies is prevalent in places such as Haiti, Panama, Belize, Liberia, Zimbabwe, Cambodia, and Myanmar.
In April 2016, the global forex market turnover share of the U.S. dollar was over 87%. While the U.S. dollar is the most commonly traded currency globally, it is also the world’s most preferred reserve currency. Data suggests that more than U.S. $5 trillion is traded in the forex market every day.
|Nicknames||Green, greenback, dough, buck, |
dead presidents, bones
|Bank notes||$1, $2, $5, $10, $20, $50, $100|
|Coins||1c, 5c, 10c, 25c, 50c, $1|
The use of the rupee dates back to the 6th century BCE, making India among the oldest issuers of coins. The word rupee is derived from the Sanskrit word “rūpyakam”, which translates to a “coin of silver”. Sher Shah Suri, a Mughal ruler, during his rule from 1540 to 1545, issued a silver coin called “Rupiya”. After India gained independence from the British in 1947, the rupee replaced the currencies of all previously autonomous states.
Decimalization of the rupee took place in 1957, when it was divided into 100 naye (new) paise. From 1947 to 1971, the Indian rupee’s exchange rate followed the par value system, with its value fixed at 4.15 grains of fine gold. The rupee’s devaluation in terms of gold resulted in a drop in its par value, to 2.88 grains of fine gold in 1949, and to 1.83 grains of fine gold in 1966.
The rupee’s exchange rate did not change from 1966 to 1971. Its value was pegged to the pound sterling in 1971, and then to a basket of currencies in 1975. The rupee’s dependence on the pegged system ended in 1991.
The use of the Indian rupee as an unofficial currency can be found in Zimbabwe, Nepal, Bangladesh, and Bhutan.
In April 2016, the Indian rupee was the 18th most traded currency in the world, accounting for 1.1% of the global forex market turnover.
|Currency symbol||, Rs|
|Bank notes||Rs 1, Rs 2, Rs 5, Rs 10, Rs 20, Rs 50, |
Rs 100, Rs 200, Rs 500, Rs 1,000
|Coins||Rs 1, Rs 2, Rs 5, Rs 10|
U.S. Dollar / Indian Rupee Historical Rates
The Indian rupee, backed by silver, devalued significantly against currencies pegged to gold for close to a century, starting from the Great Recoinage of 1816. In 1850, one British pound valued at two Indian rupees. Around the same time, the U.S. dollar was pegged to the British pound at £1:$4.79. The value of the rupee got to £1:Rs 13.33 between the two World Wars, and remained the same until the Bretton Woods agreement stayed in place.
The devaluation of the British pound against the U.S. Dollar in 1949 resulted in having an adverse effect on the Indian rupee. At this point, the rupee stood at Rs 4.76 against the dollar. The rupee was devalued in 1975, getting to Rs 7.50 against the dollar.
After India’s move to liberalize in the early 1990s, the rupee dropped in value even further. By 1995, the rupee valued at Rs 32.45 against the dollar, and by 2000 it traded as Rs 44.20 against the dollar. Since 2000, the U.S. dollar has gained in value against the Indian rupee almost consistently. However, the rupee experienced some respite during the sub-prime crisis that plagued the U.S. In October 2007, the rupee valued at Rs 39.36 against the dollar. This did not last long, with the rupee dropping to a then all-time low of at Rs 51.13 against the dollar by March 2009.
In 2009, the Indian government bought around $6.7 billion in gold from the International Monetary Fund (IMF), and this resulted in a slight upswing for the rupee’s value. The value of the rupee oscillated between Rs 44 and Rs 50 against the dollar until mid 2011.
The value of the rupee has continued to decline against the U.S dollar since. Experts suggest that this is mainly because of the lack of faith investors have showed in the Indian government’s ability to implement required market reforms. While the Indian rupee gained in value slightly after a new government was elected in 2014, it did not take long for it to begin its downward trend again.
USD/INR in the last five years
|U.S. $1 =|
|1 July, 2013||Rs 60.855|
|1 July, 2014||Rs 60.555|
|1 July, 2015||Rs 63.988|
|1 July, 2016||Rs 66.655|
|1 July, 2017||Rs 64.200|
USD/INR in the last five months
|U.S. $1 =|
|1 March, 2018||Rs 65.115|
|1 April, 2018||Rs 66.460|
|1 May, 2018||Rs 67.430|
|1 June, 2018||Rs 68.460|
|1 July, 2018||Rs 68.573|
What Affects USD/INR Rates?
The Indian rupee mostly floats on the forex market. However, the Reserve Bank of India (RBI) actively trades the rupee to manage its value to some degree. The RBI and the Indian government also take other measures to try and keep the value of the rupee in check. In addition, the government subjects the rupee to different convertibility restrictions and capital controls. For instance, foreign nationals cannot import or export Indian rupees legally, and Indian citizens have to follow stringent limits
Policy changes affected by the U.S. Federal Reserve may also have a bearing on how the dollar to rupee exchange rate oscillates. Some of the other factors that may affect this currency pair include trade deficits of both countries as well as prevailing investor sentiment.
If you want to transfer money from the U.S. to India or in the other direction, the USD/INR exchange rate requires your attention. While you might be tempted to use the services of a bank, make sure you compare its services with some of the top overseas money transfer companies first.