Press Esc to close
Friday 29 August 2014
News updated at 5:30 PM IST
Weather
Max: 25.6°C
Min : 19.7°C
In Bangalore
Generally cloudy

Rupee may plunge to 61.50/USD in three months: Credit Suisse

New Delhi, Jun 30, 2013 (PTI):

The rupee, which has depreciated by nearly 10 per cent in the last few months, is likely to weaken further and may touch 61.50/USD in next three months and 62/USD in the next 12 months, Credit Suisse said.

Credit Suisse forex strategists are currently expecting the rupee to fall to 61.5 against the dollar in the next three months and reach 62 this time next year.

Keeping in view the recent developments in rupee, Credit Suisse said that chances of the RBI cutting rates at July 30 meeting are close to "zero", but on the reverse if the rupee continues to plunge further rate hikes will come onto the agenda.


"The depreciation of the rupee means the chance of the RBI cutting interest rates at its next meeting on July 30 is virtually zero, and indeed there is probably a higher risk of rate hikes not cuts right now, given Subbarao's hawkish nature," Credit Suisse said in a research note.

The rupee last week sank to an all-time low of 60.72 against dollar on heavy capital outflows and month-end dollar demand from importers.

After a period of relative stability from mid-2012, the Indian rupee began to lurch higher (depreciate) against the US dollar from early May. Since then it has lost more than 11 per cent of its value.

With regards to inflation, Credit Suisse said if the rupee were to stabilise at the current level, WPI inflation will be boosted by 50 to 75 basis points taking into account the softening in USD-denominated commodity prices to date.

The report, however, ruled out a repeat of the 1991 balance of payment (BOP) crisis as "premature".

"The country's forex reserves (which cover around six months of imports and are nearly three times the size of short term external debt) also buys the country plenty of time," Credit Suisse said.

Go to Top

Photo Gallery
Union Railway Minister Sadananda Gowda during a visit to Ernakulam railway station in Kochi ...

Union Railway Minister Sadananda Gowda during a visit to Ernakulam railway station in Kochi ...

Bomb Squad members checking a suspected bag found at Bandra Station in Mumbai ...

Bomb Squad members checking a suspected bag found at Bandra Station in Mumbai ...

Red Cross workers walk through an Ebola hit area  in Monrovia, Liberia ...

Red Cross workers walk through an Ebola hit area in Monrovia, Liberia ...

Models take part in awareness campaign 'Save Ganga and Green India' in Bhopal ...

Models take part in awareness campaign 'Save Ganga and Green India' in Bhopal ...

Siddaramiah presenting kit to a beneficiary  during launch of 'Pradhan Mantri Jan-Dhan Yojana' ...

Siddaramiah presenting kit to a beneficiary during launch of 'Pradhan Mantri Jan-Dhan Yojana' ...

Ganesh idol made of dry fruits ahead of Ganesh Chaturthi festival in Mumbai ...

Ganesh idol made of dry fruits ahead of Ganesh Chaturthi festival in Mumbai ...

A young girl viewing Ganesh statues for sale on the eve of the Ganesh Chaturthi in Jaipur ...

A young girl viewing Ganesh statues for sale on the eve of the Ganesh Chaturthi in Jaipur ...

Team owners Sachin Tendulkar and Ranbir Kapoor during the launch of Indian Super League ...

Team owners Sachin Tendulkar and Ranbir Kapoor during the launch of Indian Super League ...

John Abraham, signs a football during the launch of the Indian Super League, in Mumbai ...

John Abraham, signs a football during the launch of the Indian Super League, in Mumbai ...

Founding chairperson Nita Ambani at the launch of the Indian Super League in Mumbai ...

Founding chairperson Nita Ambani at the launch of the Indian Super League in Mumbai ...

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bangalore - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523