The Indian Rupee has recovered some ground against its peers as Indian policy makers gather in Mumbai to discuss plans to slow the Rupees falling trend.
The currency briefly recovered some ground after it was announced that Raghuram Rajan, a former chief economist at the International Monetary Fund was named as the next governor for the Reserve Bank of India. Rajan is credited with predicting the 2008 economic crisis and his appointed settled investor nerves.
“The appointment, coupled with RBI intervention, allowed the India Rupee to rebound from all-time lows yesterday, and new measures to support it are expected in weeks to come,” Dariusz Kowalczyk, a Hong Kong-based strategist at Credit Agricole CIB, wrote in a note today. “This will at least slow the Rupee’s slide in the near term.”
The rebound was short-lived however following the release of better-than-expected data out of the United States. The rupee has been hurt by India’s current-account deficit, which widened to an unprecedented $87.8 billion in the 12 months through March. Concern that the Federal Reserve could reduce monetary stimulus as the US economy continues to strengthen has also triggered capital outflows from emerging markets.
The currency could see a reversal in fortunes however. Policymakers have gathered in Mumbai to discuss the issue of the falling Rupee and are expected to announce further measures to halt the Rupee’s rapid fall.
New measures need to be introduced following the Central Banks failed gamble last month as it attempted to drain market liquidity in order to defend the Rupee. Measures that could be brought into effect include a repo hike or NRI bond sale.
“Everyone is expecting the government and RBI to announce some steps. How long will they help the rupee depends on what steps they take. A strong move like a repo hike or a NRI bond sale may have a substantial positive impact,” said Anjali Verma, economist at PhillipCapital in Mumbai.
Current Rupee (INR) Exchange Rates:
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The Pound Sterling/ Indian Rupee Exchange Rate is currently in the region of: 93.7457<
The Euro/Indian Rupee Exchange Rate is currently in the region of: 81.3150 <
The US Dollar/Indian Rupee Exchange Rate is currently in the region of: 61.2497 <
The Australian Dollar/Indian Rupee Exchange Rate is currently in the region of: 54.7616<
The New Zealand Dollar/Indian Rupee Exchange Rate is currently in the region of: 48.3588 <
The Canadian Dollar/Indian Rupee Exchange Rate is currently in the region of: 58.7709 <
(Correct as of 10:25 am GMT)
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