The US dollar fell to two-year lows on Thursday as the hope of a fiscal stimulus grows in the Unites States. Crude prices also, in turn, are at their highest since March.
“We do think dollar will continue to depreciate,” said Mitul Kotecha, Senior Emerging Markets Strategist, TD Securities in an interview with CNBC-TV18.
He believes dollar has been under severe pressure in the last several months. “It will fall below 90. We do think in the near-term there is a risk of a dollar bounce possibly into the first quarter. The sentiment is already very weak, the consensus is very negative,” he said.
“It is the fact that we have had a weaker dollar overall, stronger inflows into Asia and India has been one of the biggest beneficiaries. So it is one reason why the rupee has underperformed some of its peers and I think that will continue into next year,” he said.
“Reserve Bank of India (RBI) has appeared to be quite aggressive in its intervention in the last several months. It has been absorbing a lot of dollar inflows through intervention,” he added.
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