Exchange Rate Calculator

The exchange rate between the Indian Rupee (INR) and the Canadian Dollar (CAD) is a crucial indicator for businesses, investors, and individuals engaged in trade or financial activities between India and Canada. Over the past several months, the INR/CAD exchange rate has exhibited notable fluctuations, influenced by various economic factors and global events. This report provides an analysis of the recent trends, underlying causes, and potential future movements of the INR/CAD exchange rate.

Recent Trends in INR/CAD Exchange Rate

Between September 2024 and March 2025, the INR/CAD exchange rate experienced a range of movements:

• Highest Rate: On December 18, 2024, the exchange rate peaked at 1 INR = 0.01696 CAD.

• Lowest Rate: The lowest point was recorded on September 24, 2024, at 1 INR = 0.01607 CAD.

• Average Rate: Over this period, the average exchange rate was approximately 1 INR = 0.01653 CAD.

These figures indicate a general strengthening of the Indian Rupee against the Canadian Dollar during this timeframe. Specifically, the INR/CAD rate increased by approximately 1.81% over the six months leading up to March 18, 2025.

Factors Influencing the Exchange Rate

Several key factors have contributed to the observed fluctuations in the INR/CAD exchange rate:

1. Economic Performance:

• India: India's economy showed robust growth during this period, driven by strong domestic demand, increased foreign direct investment, and a rebound in manufacturing and services sectors. This economic strength bolstered investor confidence in the Indian Rupee.

• Canada: Canada faced economic challenges, including a slowdown in the energy sector due to fluctuating oil prices and reduced global demand. As a significant exporter of oil, Canada's economic performance is closely tied to energy markets, impacting the value of the Canadian Dollar.

1. Monetary Policies:

• Reserve Bank of India (RBI): The RBI maintained a balanced monetary policy, focusing on controlling inflation while supporting economic growth. Stable interest rates and prudent fiscal measures contributed to the Rupee's stability.

• Bank of Canada: The Bank of Canada adopted a cautious approach, keeping interest rates relatively low to stimulate economic activity. However, concerns over inflation and economic recovery influenced market perceptions of the Canadian Dollar.

1. Global Trade Dynamics:

• India's expanding trade relations and export growth, particularly in the technology and pharmaceutical sectors, enhanced the Rupee's appeal.

• Canada's trade balance was affected by declining demand for commodities, especially oil, leading to a weaker Canadian Dollar.

1. Geopolitical Events:

• Global geopolitical tensions and trade disputes created uncertainties in the foreign exchange markets.

• India's stable political environment and proactive economic reforms attracted foreign investment, strengthening the Rupee.

Potential Future Movements

Predicting future exchange rate movements involves considering various economic indicators and potential developments:

• India:

  • Continued economic growth, structural reforms, and a stable political climate may further strengthen the Rupee.
  • However, external factors such as global economic slowdowns or trade disruptions could pose risks.

• Canada:

  • Recovery in the energy sector and diversification of the economy could bolster the Canadian Dollar.
  • Monetary policy adjustments in response to inflation and economic performance will also play a critical role.

Conclusion

The INR/CAD exchange rate has shown a strengthening of the Indian Rupee against the Canadian Dollar over the past several months, influenced by economic performances, monetary policies, trade dynamics, and geopolitical events. While current trends suggest a favorable outlook for the Rupee, ongoing monitoring of global economic conditions and policy decisions is essential for accurate forecasting and informed financial planning.