How can it be high and low at the same time?

Macroeconomics is extremely difficult because of so many unpredictable variables which depend on what other countries do and on which we have no control. For instance, even the Prime Minister, Li Keqiang does not believe the figures put out by the Chinese government and Greece has admitted that it fudged its deficit figures to enter the Euro. So what to make of the figures about our economy, especially the rupee? The dollar has gained 10% against other currencies in 2015 on top of a 13% gain in 2014. The Euro has fallen 20% against the dollar, the Brazilian real is down 28%, despite interest rate being increased to 12.75%, the Malaysian ringgit is down 5%, the Indonesian rupiah by 6%, the South African rand by 5.7% while the Turkish lira is down 10.5%. While all the emerging market currencies have fallen the Indian rupee is standing strong, up by 0.7%. So is the rupee grossly overvalued? According to our Reserve Bank the Real Effective Exchange Rate of the rupee against a basket of 36 currencies was 112.70 in February as opposed to 110.05% in January. It was 101.97 at the same time last year. According to this measure the rupee is overvalued. A strong rupee keeps down the cost of imports, especially oil, which keeps a check on inflation, but is bad news for exports because it makes our products more expensive compared to other countries and when money is brought back to India companies get fewer rupees in exchange, which reduces their profits. To keep the rupee from appreciating even further the Reserve Bank buys dollars from the market, which builds up reserves, but releasing large amounts of rupees into the market may cause inflation, by increasing liquidity, so the RBI has to sell bonds to mop up excess money supply. However, the International Monetary Fund uses Purchasing Power Parity in which only Rs 18.5 is needed to buy a common basket of goods that needs one dollar elsewhere. At an exchange rate of 62 to the dollar the rupee is undervalued by more than 60% according to this measure. If we compare inflation rates between the US and India since 1995 we see that retail inflation has been consistently higher in India which means that the rupee buys less every year, which is reflected by the fact that one dollar bought Rs 7.5 in 1966 as opposed to Rs 62 today. Because of cultural differences, cost of labor and local taxes PPP can never measure like for like. The only true measure is the cost of real estate. After all 1 acre of land is the same everywhere. Here we find that the cost of real estate is the same or higher in India. Which maybe why Indians found it more profitable to invest in real estate in Dubai and spent $5.8 billion on properties in the US last year. Therefore, for us the rupee is grossly overvalued. But then we are no highly paid economists.