Strategic Consultant
Federal Reserve Chair Jerome Powell emphasized the Fed's readiness to provide dollar liquidity to foreign central banks via swap lines amid rising global financial uncertainty. His statement highlights the Fed's vital role in stabilizing the international dollar funding market, essential for global trade and banking stability. While larger emerging markets have access to these resources, many smaller economies remain vulnerable, underscoring the need for diverse funding strategies.
Amidst alarming headlines about a potential U.S. financial crisis driven by "twin deficits," the reality is more nuanced. The U.S. dollar's status as the global reserve currency allows for sustainable debt management. While concerns about public debt exist, historical context shows the U.S. economy possesses unique strengths, such as a services surplus and the ability to control monetary policy, enabling it to navigate challenges effectively.
AI is indeed revolutionizing economies, but its benefits are disproportionately distributed, with advanced nations reaping more advantages compared to developing countries. To create a fair future, it is essential to implement inclusive policies, foster international cooperation, and prioritize the ethical development of AI technologies.
In 2024, the Indian rupee depreciated by about 3%, highlighting a 20% decline over five years. Factors include a demand-supply mismatch, persistent current account deficit, higher inflation, slow GDP growth, and US interest rates. To stabilize the rupee, India must boost exports, attract investments, manage inflation, and strengthen production.
Indrajit Roy Choudhury 