Yesterday, the rupee fell below the key psychological level of 55 to hit a new record low.
According to experts, the next technical level is around 55.25. “If 55.25 gives way then there will be a set-up of panic in the market and we can see a quick run to 56.75-57.
The Reserve Bank of India (RBI) has done everything to arrest the fall. But the way rupee is running towards 56-57 it is a surprise and worry for the RBI. Nothing has worked out because of the strong bearish set-up on the fundamentals and the negative sentiment on the way forward.
Also strong demand from of dollar from Oil companies will keep it high.
The next option RBI has in hand is to put operative structure and also to generate dollars from overseas so as to support their intervention measures. So, I think if operative structures do not work out, I think RBI will think of bond issuance in the line of resurgent India bonds.
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