INR

What does 'INR' mean

INR is the International Organization for Standardization currency code for the Indian rupee, the currency of India. The rupee is made up of 100 paise and its currency symbol is _. The rupee derives its name from the rupiya, a silver coin first issued by Sultan Sher Shah Suri in the 16th century.

BREAKING DOWN 'INR'

Rupees are issued as coins in denominations of 50 paise and _10. Paper rupees are issued in denominations of _1, _2, _5, _10, _20, _50, _100, _500 and _1,000. On the reverse side of paper rupees, denominations are printed in 15 languages, while denominations are printed in Hindi and English on the front side.

In the 19th century, large increases in the quantity of silver production caused a precipitous drop in silver's value, leading to a steep decline in the rupee's value. From 1927 to 1946, the rupee was pegged to the British pound. It was then pegged to the U.S. dollar until 1975. Currently, it mostly floats on the foreign exchange market, with the Reserve Bank of India (RBI) actively trading the currency to manage its value.

Capital and Convertibility Controls

The Indian government and RBI intervene in other ways to manage the rupee's value. The rupee is subject to various capital controls and convertibility restrictions. For example, it is illegal for foreign nationals to import or export rupees, and Indian nationals may only import and export rupees in limited amounts. In 2009, the Indian government purchased $6.7 billion in gold from the IMF, which led to a further rise in the rupee.

The Rupee's Value in Modern Times

The rupee's long and steady ascent ended in 2011. Between 2011 and 2015, the currency lost more than one-third of its value relative to the U.S. dollar. Many economists predicted that the drop in oil and commodity prices would support the rupee during 2015 because India is a major oil and commodity importer. However, the rupee continued its decline, mostly as a result of the steep decline in emerging markets economies. Another often-cited reason for the rupee's decline during this period is a lack of faith by investors in the Indian government's ability to implement market reforms.

At the 2015 World Economic Forum in Davos, Switzerland, RBI Governor Raghuram Rajan pointed to the relative strength of the rupee. Other emerging market currencies declined more relative to the U.S. dollar, while the economies and stock markets of other emerging markets experienced larger declines. The rupee appreciated against some other major currencies during 2015, including the pound and the euro.