It's not the dollar.

"In this year, the dollar index, which measures the performance of the greenback against a basket of currencies is up 14%, while the rupee's fall is at about 10%," wrote Mayur Shetty. If the rupee falls because of "domestic factors like inflation or current account deficit, it is the rupee that is said to be weakening. However, if the drivers of change are global factors like money flowing into US dollar assets, then the dollar is said to be gaining." The rupee is not weakening, said Finance Minister Nirmala Sitharaman. "The dollar is strengthening incessantly." "I think the Indian rupee has performed much better than many other emerging market currencies." BT. "In absolute terms, the current account deficit (CAD) stood at $23.90 billion in the first quarter of the fiscal year 2022-23, its highest since the December quarter of 2012. However, as a percentage of GDP, the CAD was at 2.8%, its highest in nearly four years." Reuters.  "CAD will certainly widen further despite the moderation in crude oil prices," said Rupa Nege Nitsure. "Going by the underlying trends, India's CAD may be 3.5-3.7% of GDP in FY23." "India has always had a trade deficit thanks to our fetish for buying gold," wrote Shetty. So, it's the fault of Indian citizens. "India's gold imports, which have a bearing on the country's CAD, rose 6.4 percent to $12.9 billion during April-July this fiscal due to healthy demand." TOI. In the financial year 2021-22, India's gold imports rose 33.34% over the previous year to $46.14 billion. It was $34.62 billion in 2020-21. BS. Is this an illogical "fetish" of stupid Indians? After all, you do not get any interest on physical gold, you have to pay for safekeeping in a bank and its value may drop. But then, "Central banks bought 400 metric tonnes of gold in the September quarter, by World Gold Council data," wrote David Fickling. "All are from nations facing problems. Turkey, whose lira slumped 52% over the year through September, added 95.5 tonnes to its gold holdings in the same period. Egypt bought 44.8 tonnes, while its pound fell 20%. India's 40.5-tonne purchase was matched by an 8.7% rupee weakening." One metric tonne of gold cost $54.82 million on 9 November 2022. Daily Metal. So, the Reserve Bank of India (RBI) spent $2220.21 million to buy 40.5 MT of gold. That has to be a humongous "fetish". With the US weaponising the dollar the RBI may be trying to hedge its bets. While the rupee has depreciated 8.7%, diminishing its buying power by that extent, the RBI has increased interest rate by a cumulative 1.9% to 5.9%, TOI, even though retail inflation rose to a 5-month high of 7.41% in September. Mint. That means savers are losing heavily because banks pay less interest on fixed deposits while charging higher on loans. State Bank of India (SBI) reported "its highest-ever quarterly profit after tax (PAT) of Rs 13,264.62 crore (Rs 132.6462 billion), up 74% year-on-year, for the quarter ended September 30, 2022." ET. Just as the RBI is hedging against the US by buying gold, Indians are hedging against the RBI. CAD will rise, rupee will fall. It's not the dollar. It's the rupee.