Rupee is likely to depreciate further against USD and may hit its historic low by crossing all the limits and might reach up to Rs 62-63 per USD by 2014, according to CLSA. Indian Rupee is the most depreciated currency in last few weeks, which has come down over 9% in last few weeks.
Rupee against Dollar was at 4.75 in 1952 which has reached at 59.95 as of June, 20, 2013, an all-time high rate.
Export market is also not boosting up much to uplift the depreciating value of rupee in the global market. The economic crisis across the world in many countries has hit one of the major trading partners of India i.e.; Euro Zone creating an impact of deterioration in demand of goods from India and thus decreasing its exporting rates.
Recently in an interview to media, Agam Gupta, MD & FI Trading, Standard Chartered Bank said regarding the exports of the country that, “Currently, it is more than Rs 3 in one year and so we are advising exporters to sell on any uptick and take advantage of the forward premium on medium-term basis. But if we see dips below 59/USD and towards 58.5/USD, then it is a good level for importers to hedge the short-term payables. So, we are looking at a range of 58.5/USD to 60/USD currently and if the actual outflows from the equity market pickup then there is good chance at 60/USD breaks.”
Depreciating rupee is becoming a threat for the Indian economy as well. At present USD is holding a strong position in the global market and is at high demand from the foreign exchange market across the world. If the demand for the dollar remains same or increase with the passing time there are high chances of further depletion in the value of rupee.