USD at ₹64, poised for 60 in few months

When it rains, it pours cats and dogs. how true is this saying. A period where everything is working in India’s favor, good governance, good geo-politics, international accreditation, good monsoon, pro-industry bureaucracy, lower commodity prices, high on reforms, high on FOREX and along with that strength of the INR.

A couple of months back, USD was trading at ₹69 to a dollar, now it is ₹64, a near 10% appreciation. If INR appreciates, it is pain for exporters. IT companies have lost 10% of their margins just because of this appreciation. Analysts expect the USD to reach 60 soon, IT and Pharma will become a sure no, no for investors.

In spite of the USD losing value, our FOREX reserves have reached historic peak, we are about to touch the $400 Billion mark by September 2017. Again another good thing is that, the remittances from NRI’s have been on the high, both because of the top class investment climate in India and the uncertainties of holding USD. Along with this advantage, Crude Oil prices holding at $60 is a big advantage for India.

Above 60B$ saved per annum and crude will not see its previous high of 126$ again, it will only decline. All these savings are expected to be ploughed into the economy in various ways, one of the main emphasis would be infrastructure. Look forward to see a totally changed India in the next decade.

About Author

Ramesh Sigamani

Ramesh Sigamani

With over 3 decades of experience in capital market investments, Ramesh Sigamani is a trusted Financial Planner par excellence. He works personally with individuals and corporates to build a strong investment portfolio that stands firm against market volatilities and delivers time & time again.

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Comments ( 2 )

  • Ramesh Sigamani
    Ramesh Sigamani

    Exactly 1 month month from the above articles writing, India reaches the $400 b Forex reserve mark. We did anticipate it to come in the first week of September, while it took one more week to reach. FPI contribution in this $400b is above 50b and there is more money waiting to come in as the limits have got exhausted. RBI is in the verge of relaxing the limit by another 2b$.
    This inflow will strengthen the Rupee, which is getting strong even after our imports have risen and exports have a decline.
    What a condition for India, from a growth hungry status to extensive growth from all levels. People, enjoy the beautiful moments of this transformation.
    Yesterday our Prime Minister Narendra Modi, in his speech after dedicating the Sardar Sarovar Dam to the nation said, “Let us leave no stone unturned in creating a ‘New India’ by 2022, when we mark 75 years of India’s freedom”

  • Ramesh Sigamani

    Revisiting this blog in November 2018. Crude tried reaching for higher price, could manage only $84. Dollar on the other hand had a free run to 74.50. Now both are cooling down.
    There is one more rally likely in both and after that, price will get tamed.

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