The Indian rupee fell further this morning in response to a global sell-off across emerging markets. In intra-day trade, the currency touched a two-year low of 65.90 per US dollar. The last time we saw these levels on the Indian currency was on 6 September 2013, incidentally the week that Raghuram Rajan took over as the Reserve Bank of India (RBI) governor.

The day Rajan took over, on 4 September, the currency was trading at 67 per dollar, having just about recovered from all-time lows of 68.82 per dollar on 28 August. One of the immediate decisions that Rajan took was to boost reserves through a scheme incentivizing banks to raise foreign currency non-resident deposits. That had helped the rupee back to 66 per dollar levels the day after Rajan began his governorship.

If the current bout of nervousness across global markets continues, a fall back to those 66 per dollar levels is quite possible.

So have events come a full circle for Rajan and the rupee? The answer to that is: No. That’s because the 66 of 2015 is not equal to the 66 of 2013.

In 2015, the rupee is falling in sync with global currencies. In fact, the rupee is still among the top five best-performing currencies in the world since the beginning of this year. Year-to-date, the rupee has fallen less than 4% which is nothing when compared to the bruising that other emerging market currencies, like the Malaysian ringgit, have taken. On Friday, the Malaysian ringgit fell to a 17-year low, in a fall that has reminded a number of global commentators of the 1998 currency crisis, which was partly blamed on prominent foreign investors like George Soros betting against the Malaysian currency.

So in comparative terms, the rupee is better off compared with most emerging market currencies, a point highlighted by the RBI governor at a public speaking event on Thursday.

There are other fundamental reasons why we don’t need to worry about the rupee depreciation as much as we did two years ago. Those reasons were highlighted by Mint in a previous article which can be read here.

The problem is that the equity markets are beginning to get nervous about the falling currency. Remember that a depreciating rupee is a direct hit on profits that foreign investors were hoping to take home from the Indian markets. Given that the equity markets are now flat for the year in terms of gains, the falling currency could make investors question whether they want to stay invested. A lot of foreign capital came into the Indian markets in 2014 and then some in 2015, and expectation of further depreciation could see some of this capital being returned.

There is one other reason to be watchful and that is the impact that the currency has on corporate earnings. Earlier this week, an RBI study had pointed out that the impact of currency moves on earnings has increased “manifold" in the post-crisis years. A depreciating currency tends to impact earnings negatively, the study had found. Given that the rupee has fallen about 12% since May 2014 highs, the currency factor may be playing a role in continuing weak corporate earnings.

Even so, a fall to a two-year low on the Indian rupee should not spark the kind of nervous reaction we saw back then. A testament to that is the fact that after being part of Morgan Stanley’s “fragile five" currency grouping in 2013, the Indian rupee does not even fall in the list of “troubled ten" currencies being watched by the brokerage in 2015, according to a 17 August Bloomberg report.