Indian Currency Devaluation against US Dollar

May 02 2016 03:23 PM
Indian Currency Devaluation against US Dollar

New Delhi: On Monday, rupee depreciates 6 paise to 66.39 against the US Dollar aimed lack of cues from Asian currency market. Against the greenback on fresh dollar selling by banks and exporters, The domestic currency had slipped 19 paise on Friday to settle at 66.33.

Fund Manager (Fixed Income) at UTI MF, Sudhir Agarwal Said- "For the time being, the rupee might be range bound till we get further cues on the US data points. So the close range of around 66.25-67.25 might be the immediate trading band on the rupee. I think it should move in either direction in big way, only if you get some surprising data on the US Fed front,"

Agarwal said ,"We will have to wait for that data and probably, maybe for two-three more months and see if the Fed is deciding to move as per market expectation in June or not. I think that could drag our currency further,".

On the other hand, SMC investments and Advisors expecting the domestic currency to trade in a range of 65.50-67.60 in the near term.

"There are a number of factors that are unresolved for markets and given that we are in a fairly soft global growth outlook. The Fed may not be easing soon but they are still going to ease at some point. We could see a reversal in energy prices. The dollar is looking too soft. I think all these factors are actually going to reverse in the months ahead and that could put more pressure on markets," said Mitul Kotecha, Head-FX Strategy, APAC, Barclays.

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