The ebbing concerns about Syria helped the Indian currency tread on the path of recovery and on Tuesday it rose to a two-week high that is as much as 1.7 percent on the day.
The ebbing concerns about Syria helped the Indian currency tread on the path of recovery and on Tuesday it rose to a two-week high that is as much as 1.7 percent on the day.
After hitting record lows last month, rupee looked set for a fourth uninterrupted session of gains after former International Monetary Fund Chief Economist Raghuram Rajan took controls of the Reserve Bank of India last week and immediately announced measures to hold the falling currency and open up Indian markets.
Analysts hope that Rajan, a suave, unflappable University of Chicago economist, will come up with more market-friendly measures, which will further boost the market and make it easier for the non-residents to buy shares of listed companies.
The government will also put in place more steps in the next few days to curtail non-essential imports, with prospects growing for a hike in subsidised diesel prices that would relieve concerns about the government’s finances.
Reportedly, the chief executive at India Forex Advisor, Abhishek Goenka said the delay on any possible action on Syria has helped market sentiment and the rupee was also poised for a correction. However, we are not overtly optimistic. We have a stop-loss at 65 and we will turn dollar buyers at that level.
The government’s steps to reduce gold imports has already helped to contain the trade deficit over June and July to a shade over $12 billion, down from a recent monthly average of $17 billion in the earlier six months. However, not everybody expects an export bonanza from a weak rupee.
