Image Source: India Today
The Indian rupee will lose almost all of its year-to-date appreciation against the U.S. dollar by the end of July, a new Reuters survey of foreign exchange analysts forecasts. The poll taken between April 30 and May 6 forecasts the rupee to weaken to 85.50 per dollar in three months, to 86.30 by the end of October, and to 86.28 by the end of April 2026.
Experts attribute the expected depreciation to a slow-down in the Indian economy, which is projected to expand at a lower rate of 6.3% in the current and coming financial years, compared to 9% in 2023–24. The recent intervention by the Reserve Bank of India in relaxing its intervention in the currency market is also being seen as the prime reason for the rupee's expected decline.
Though a brief April rally was fueled by net capital inflows of about $500 million by overseas investors-the rupee's strength is considered unsustainable in the face of unstable capital flows and rising economic uncertainty. The survey also indicates greater implied volatility of the rupee, the two-year high, and indicates that expected interest rate reductions by the RBI will add to the pressure on the currency.
Source: Reuters
Source: ReutersThe Indian rupee will lose almost all of its year-to-date appreciation against the U.S. dollar by the end of July, a new Reuters survey of foreign exchange analysts forecasts. The poll taken between April 30 and May 6 forecasts the rupee to weaken to 85.50 per dollar in three months, to 86.30 by the end of October, and to 86.28 by the end of April 2026.
Experts attribute the expected depreciation to a slow-down in the Indian economy, which is projected to expand at a lower rate of 6.3% in the current and coming financial years, compared to 9% in 2023–24. The recent intervention by the Reserve Bank of India in relaxing its intervention in the currency market is also being seen as the prime reason for the rupee's expected decline.
Though a brief April rally was fueled by net capital inflows of about $500 million by overseas investors-the rupee's strength is considered unsustainable in the face of unstable capital flows and rising economic uncertainty. The survey also indicates greater implied volatility of the rupee, the two-year high, and indicates that expected interest rate reductions by the RBI will add to the pressure on the currency.
Source: Reuters
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