After demonetisation, all calculations and projections have been turning red and even on forex front, the Indian rupee is seen dwindling further in value to about 70 per US dollar in 2017, said a poll-based survey by Reuters.
“The rupee is expected to fall further against the US dollar this year to a record low, hit by rising global bond yields and an economic blow from New Delhi’s dramatic currency crackdown launched two months ago,” said the Reuters poll.
“It is expected to fall further to 69.50 by year-end. That 12-month consensus is the weakest for several years and would mark a record low,” it said. Quoting a poll conducted three months ago, Reuters Polling team said three months back the view in a Reuters poll was for the rupee to trade at 67.73 in 2017.
In the year 2016, the rupee remained stronger with variance at below 2 percent, which was better than most of the regional peers making the India’s economy the fastest-growing in Asia. But the election of Donald Trump in the US presidential election and the effect of demonetisation by Indian Prime Minister Narendra Modi have reversed the expections, said the report.
“We see a less rosy scenario in the capital account and current account front in the coming two years, with global bond yields and money flowing back to the US,” said Bhupesh Bameta, head of FX research at Edelweiss Financial Services in Mumbai, participating in the poll.
Since demonetization has roughed up many savings avenues, the attraction for gold may come back again, he added.