Crisil Research has forecast that therupee will appreciate to around 50 to the dollar by March 2013 end. The research firm said there was a two-in-three chance of this happening, with the alternate scenario (one-in-three chance) being the rupee settling at 55-57 to the dollar by March 2013 end.
The reasons it expects the ruppee to appreciate include initiation of domestic policy measures to revive growth, no further worsening of growth and inflation and an easing of current account deficit due to softening of crude and commodity prices.
All of which could whet investor appetite, it said, adding that improvement in the Eurozone situation in the first quarter of 2013 could also stimulate return of capital flows into Indian markets.
The alternate scenario assumes status quo in domestic policy setting and no change in the Eurozone problems and ongoing global turbulence.
Although the pressure on current account will ease to some extent, due to lower global crude oil prices and declining gold imports, muted foreign inflows will maintain the depreciation pressure on the rupee, Crisil Research said.
Source: The Economic Times
Leave a Reply