Mumbai: The rupee continued its incessant free fall for the ninth straight day on Tuesday by dropping 26 paise to end at a fresh 2-1/2 month low of 67.75 on sustained demand for the American currency.
However, India’s rupee is considered to be the best performing currency among emerging markets against the dollar, including the Bric countries. This was the consensus among more than 300 corporate and finance executives as a FX 16 summit convened by Bloomberg.
Forty three per cent of the executives expect the rupee to be the best performing currency followed by 40 per cent claimed the Japanese Yen would be the best performing. Very few expect the rest of the emerging markets from Indonesia to Malaysia and China to put on a strong showing against the US dollar.
On the macro issues affecting the rupee, 41 per cent said the Chinese economy and 33 per cent viewed a US rate hike as the other factor. Forex expert Abhishek Goenka of India Forex Advisory observes that the rupee has adjusted well to the fluctuations over the US Fed’s stand. Earlier, it was dovish but now it’s hawkish.
He points out that though the dollar index has moved up 25 per cent from $80-100 between the Q3 of 2014 to 2015 the rupee has depreciated just 12 per cent in the period. Globally currencies depreciated 15-20 per cent in the last two years. Since the BJP government took over in May 2014, the rupee has depreciated from Rs 60 to Rs 67.69 (Tuesday’s rate).
