India-US deal to keep weighing on rupee: Poll

THE INDIAN RUPEE is expected to remain under pressure until India signs a trade with the US, said economists and treasury heads inan FE poll.

- CHRISTINA TITUS

However, 75% believe that it maynotbreach 90 against the dollar in the next one month unless the Reserve Bank of India does not support the currency through interventions.

According to VRC Reddy, treasury head, Karur Vysya Bank, the 90 level will be protected fora few more weeks. He expects the positive trade deal outcome by December-end would drive the rupee to 88.20.

“The sharp fall in the rupee was led by speculation on the trade deal. There has been constant depreciation pressure on the rupee due to capital outflows. Moreover, recent widening in the trade deficit due to gold imports has also increased demand for dollars,” said Gaura Sengupta, chief economist, IDFC FIRST Bank.

Most participants are quite optimistic about the trade deal happening soon, which will help the rupee to return to the 88 level.