It's taken 23 months.

"India's central bank has zero tolerance for volatile and bumpy movements in the rupee and will continue to engage with the foreign exchange market to ensure the rupee finds its level, chief Shaktikanta Das said. The rupee has been hitting a series of record lows in recent weeks and has broken past the psychological 80 per dollar mark earlier this week and prompted heavy dollar selling from the Reserve Bank of India (RBI)." ET. "The country's foreign exchange reserves declined by USD 7.541 billion to USD 572.712 billion in the week ended July 15 as the Reserve Bank continued to intervene in the market to curb the fall of the rupee." ET. "On Friday, the rupee fell by 5 paise to close at 79.90 against the US dollar. It had touched an all-time intra-day low of 80.06 against the US dollar on Thursday." Clearly, the RBI is not just smoothing over volatility, it is actively trying to keep the rupee strong against the dollar. In fact, "India's central bank is prepared to sell a sixth of its foreign exchange reserves to defend the rupee against a rapid depreciation after it plumbed record lows in recent weeks, a senior source aware of the central bank's thinking told Reuters." ET. Chief Economic Advisor (CEA) V Anantha Nageswaran said that "unlike earlier crises, the depreciation of the rupee against the US dollar was lower than other major global currencies such as the Swiss Franc, the Euro, the British pound and the Japanese yen." BS. "While many of us are anxious about RBI raising interest rates, India's interest rate increase is somewhat milder and smaller compared to other nations." That is the crux of the matter. Do anything, including selling off our reserves, to keep interest rates low. "The American greenback is hovering at a 20-year high against its fellow major currencies, creating a huge problem for everyone outside America buying dollar-denominated goods, like crude oil. And no commodity is more important than crude oil," wrote Javier Blas. "India the world's third-largest oil consumer behind the US and China, is paying about 45% more than it was 14 years ago due to the steep depreciation of the Indian rupee against the dollar." "If rupee fails to follow when other EM currencies are depreciating, India's exports will lose competitiveness. Already, rupee has appreciated significantly against other Asian currencies such as the Korean won, the Thai baht and the Taiwanese dollar," wrote Prof Rajaswari Sengupta. "Economic theory says under ideal conditions - no transport costs, no tariffs - the price of an identical (similar) commodity will be the same in both trading partners' domestic markets, when expressed in the same currency," wrote Prof Nilanjan Banik. This is the 'law of one price or LOOP' which means that if something costs Rs 80 in India the same thing should cost $1 in the US. But, "if inflation in India is higher than it is in a trading partner, then the real exchange rate will reflect that - that is, the rupee will depreciate against the dollar." By keeping interest rate unchanged at 4% for 23 months, even as retail inflation continued to be at about 6%, which led to the rupee falling against the dollar, which will send inflation skyrocketing by increasing import prices, especially oil, and which the RBI is trying to control by selling off our wealth. Then what happens?