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More StoriesMarket analysts, too, expect the rupee to stabilise, but only at a higher level, which then would take away the benefit seen in commodity prices. IT investors are cheering Re slide but analysts caution against assuming that all foreign exchange gains will become profits. The rupee is falling because India’s CAD is at a historic high: an estimated 5% of the GDP. The world outside remains an uncertain place, where the yen is being talked down, the eurozone wobbles and the US alone grows. What India can do is to get its own act together. Agents say devaluation to impact shopping, sightseeing and eatouts. It makes the job of the RBI even harder to check inflation & stimulate growth as depreciating currency makes imports costlier. The rupee hit a new low against the USD on heavy selling by FIIs, leading to fears that the Reserve Bank of India would go slow on cutting rates. I do not know what to say except that the rupee is weak and will get weaker, which seems very likely, says Jamal Mecklai, CEO, Mecklai Financial Services.
Factoring in the increase in tuition fee and the falling value of rupee, a foreign degree is getting increasingly expensive. Last week, mkt participants were finally forced to take notice of the Re. Despite all efforts by the govt to reign in trade deficit, Re continues to be a cause of concern. This kind of volatility in rupee is not good because 8% movement in the last four months is too big a change for anybody to handle |
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