Credit Agricole said it does not see value in the rupee below 70 to a dollar unless foreign capital returns and that it would not recommend buying the currency for fundamental reasons below 75 to the dollar. “Long-term solution — deep economic, political and social reforms — is unlikely ahead of the election and possibly for years to come,” Credit Agricole said in a note dated August 21, adding to the chorus of bearish bets on the rupee. India is due to hold national elections by May.
Forex inflows ‘key’ for R: Barclays
Rupee is unlikely to get any “meaningful benefit” from RBI’s measures as the key to support the currency is boosting forex inflows, Barclays said in a research note. According to the global financial services major, two main concerns that have driven rupee’s weakness — expectations of Fed tapering and India’s ability to fund its current account and fiscal deficits — will continue to hit sentiment.