ET:Rupee seen appreciating to 52.5-53 in near term
MUMBAI: The Indian rupee gained more than 1.5 per cent today and hit a fresh four-month high. It has been the best performing currency in Asia for the past 5 days.
The rupee had a lot to cheer about today from developments in domestic and international markets.
The Samajwadi Party supported the UPA government from outside and brought cheers in the equity markets. The rupee appreciated as the threat of mid-term polls were ruled out. The Indian unit also took support from the fact that the government has not rolled back any reforms, but is pushing for more.
The Indian government last week cut back subsidy in diesel, allowed FDI in retail, aviation, broadcasting and power sectors. Markets are now optimistic about FDI in the insurance sector as well.
The global markets are also supporting the rupee on the back of high liquidity following stimulus released from the central banks in the US, Europe, Japan and China .
Going forward the rupee is bending towards further appreciation and can see levels up to 53 to 52.5 against the dollar with upside in near term capped at 55.
A report from Mecklai Financials expects the rupee to trade within 52-55 till the year end. HSBCBSE 0.24 % and JP Morgan in their latest views on the currency expect the rupee to touch 52 in the next one month. There are more bullish views from Indusind BankBSE 2.24 % of the rupee appreciating up to 50 in the medium term.
