Rupee may fall to 78/USD in 2019

The rupee may depreciate to 78 per US dollar this year, largely owing to widening fiscal and current account deficits, which are the biggest pain points for the domestic currency.

According to Karvy’s Annual Commodity and currency report, this is expected to be a “mixed year” for the commodities and currencies market and the rupee may depreciate further on account of twin-deficits.

“USD/INR is expected to move higher with a base of 68 to 69.50, with an upside at 73.70-74.50,” Ramesh Varakhedkar CEO Commodities and Currencies at Karvy told reporters. He further noted that if the rupee crosses the 74.50 level, then it is very likely that the domestic unit will depreciate further towards the 78 level in 2019. Moreover, going into the election year, both FIIs and FDIs will try to avoid the Indian markets as the uncertainty about election outcome increases.

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