Even as the Rupee continues to feel the pressure, with bankers expecting the domestic currency to hit the 70-mark against US Dollar, CLSA says that Maruti Suzuki, Asian Paints, Bharti Airtel and Adani Power will be vulnerable.
Even as the Rupee continues to feel the pressure, with bankers expecting the domestic currency to hit the 70-mark against US Dollar, CLSA says that Maruti Suzuki, Asian Paints, Bharti Airtel and Adani Power will be vulnerable. The global brokerage expects the Rupee to remain under pressure. Continued strengthening of the US dollar, lack of foreign investment inflows and concerns over rising oil prices are likely to keep the rupee under pressure and push it down to the 70 mark this week, bankers told PTI. rsday and 68.87 on Friday.
“Concerns over widening current account deficit due to higher crude prices and demand for dollar from oil companies and general importers is impacting the rupee. It may briefly touch the 70 mark this week but would not remain there,” PTI reported a senior bank official as saying. According to the agency, 69.30 remains a crucial level for the domestic currency, which if breached, could further plumb down to the 70 mark against the dollar.
Notably, the Indian Rupee had touched an all-time low of 69.10 against the dollar on June 28. It closed at a lifetime low 68.95 on Thursday. CLSA noted that reasonable forex reserves and Rupee related policies should provide support. FY19 current account deficit will be more than 2.5% of GDP. Further, the firm notes that some form of NRI deposit scheme or dollar bond issuance cannot be ruled out. Those companies who have to repay their external commercial borrowing (ECB) debt are also stocking up the US
currency, PTI reported a bank treasurer as saying. “The RBI won’t allow the rupee to fall below 69.30. If it breaches this level, the rupee will touch the 70 level in no time,” said another banker. Notably, RBI has time and again reiterated that it does not target any level of the domestic currency but intervenes in the foreign exchange (forex) market to check its volatility. The forex reserves at USD 406.058 billion as of June 29, gives RBI enough comfort to intervene in the forex market, said the PTI report.