India Ratings just released their mid-year outlook a short while ago. Devendra Kumar Pant, chief economist of India Ratings gave his projection on the rupee going forward.
“As an economist we give our view, the way the currency will remain entire fiscal year. Earlier we were close to 66-67 per dollar but now the way the things are panning out, our estimate now shows for FY19 that is from April 1, 2018 to March 31, 2019, rupee will average somewhere around 68.40 per dollar. There are many reasons why rupee is behaving the way it is behaving. It starts from the emerging market weakness as we had seen post the crisis in Turkey. We had seen the same thing happening in 2013. Our trade flows or capital flows are not as buoyant as they were in last few years. So we are witnessing a slowness in that,” he said.
“Because of commodity prices especially oil, our estimates suggest that we may have a good trade deficit somewhere around USD 190 billion for the year. We are looking at a number which is in excess of USD 71 billion on the current account – translating 2.6 percent of the GDP as the current account deficit (CAD),” he added.