Key players in the Indian foreign exchange market are vertically divided in their outlook regarding the movements of the Indian unit in the near future. A majority of them, however, see the rupee gaining strength against the dollar.

Mecklai financial services senior vice-president AK Dey: Rupee depreciation to around 43.07 to a dollar was just a temporary phenomenon and in the near term, the rupee is expected to remain stable or even strengthen a bit against the dollar. This is primarily because the market considers that after the sanctions, the budget and the downgrade by ratingagencies, the worst is already over and is not expecting any new demands for the greenback.

This sentiment is aided by the fact that the recent minor appreciation in the rupee value against the dollar has been without any support from the Reserve Bank of India. The exporters have started selling dollars. The six-month forward premium is also expected to climb down to single digit levels. The bearish sentiments for rupee seem to be dying out.

ICICI Bank vice-president (forex) KS Harshan: The 43.00-43.07 levels, which the rupee experienced early this week, were a mere speculative run and no major transactions really took place. The market sentiment now is that the rupee depreciation has been overdone and the next few weeks could see the Indian currency appreciating against the dollar.

The rupee could appreciate to a band of 42.00-42.25, and this means that it is time for exporters to jump in. No dollar demand or covering demand is expected in the near term and the six-month forward premiums will be in thenine to 10 per cent band.

HDFC Bank head (forex markets) Louis Miranda: The rupee could go down further, way beyond 43.00 to a dollar. The prime reason for this is that no real dollar inflows are expected in the near future and the corporates are still buying dollars.

Though exporters are coming in to a small extent, dollar demand still exists from importers and borrowers, and all these could see the rupee reach 45.00 to a dollar by December this year. The long-term sentiments remain negative for the rupee, and this is aided by the inaction by the Reserve Bank of India to stabilise the rupee in order to help change the sentiments.

IndusInd Bank manager forex Phillip John: The weakening of the spot rupee to 43.00 does not represent market sentiments. It reflected only the inter-bank play and there was never any support at this level. In fact, no bank quoted at this level and there was very little corporate cover.

In the recent past, sentiments have substantially improved and we might see rupee in the42.30 to 42.80 band in the near future. The importers will come in at around 42.50 to cover their near-term exposures and the exporters would soon come in with their remittances and to book profits.

Standard Chartered Bank head treasury Sharad Anand: The fall of the rupee to 43 against the dollar is a very low level and factors in all the current bearish news. In the near term, the rupee will remain within a band of 42.50 to 43.00 to a dollar, because the current levels represent a fragile equilibrium and movements beyond this band would require substantial positive or negative developments.

Exporters entering the markets with their receivables will not have any major impact on the rupee since the Indian exports have been shoddy to say the least and, therefore, no substantial dollar export earnings exist.

Dollar inflows could definitely be on account of PSU disinvestments, but a major wild card could be the Resurgent India Bonds, which if priced properly, could result in good inflows of the greenback upto two and a half billion dollars. If the rupee stabilises, more FII money could be expected.